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Y  l.l/2:Serial  13760 

United  Stales  Congressional.. 


i  f 


100th  Congress  —  1st  Session        •       January  6-December  22,  1987 


Senate  Report 

No.  216 


IRAN-CONTRA  INVESTIGATION 

APPENDIX  B,  VOLUME  19 
DEPOSITIONS 


United  States  Congressional  Serial  Set 

Serial  Number  13760 


United  States  Government  Printing  Office 
Washington  :  1989 


Union  Calendar  No.  277 
100th  Congress,  1st  Session 
S.  Rept.  No.  100-216  H.  Rept.  No.  100-433 


Report   of  the  Congressional   Committees   Investigating   the 

Iran-Contra  Affair 

Appendix  B:  Volume  19 
Depositions 


Daniel  K.  Inouye,  Chairman, 
Senate  Select  Committee 

Lee  H,  Hamilton,  Chairman, 
House  Select  Committee 


U.S.  Senate  Select  Committee  U.S.  House  of  Representatives 

On  Secret  Military  Assistance  to  Iran  Select  Committee  to  Investigate 

And  the  Nicaraguan  Opposition  Covert  Arms  Transactions  with  Iran 

November  13,  1987.  -  Committed  to  the  Committee  of  the  Whole  House 

on  the  State  of  the  Union  and  ordered  to  be  printed. 

November  17,  1987.  — Ordered  to  be  printed. 


Washington  :  1988 


lanittd  States  3enatt 

SELECT  COMMITTEE  ON  SECRET  MILITARY 

ASSISTANCE  TO  IRAN  AND  THE  NICARAGUAN  OPPOSITION 

WASHINGTON,  DC  20510-6480 


March    1,     1988 

Honorcible  John  C.  Stennis 
President  pro  tempore 
United  States  Senate 
Washington,  D.C. 

Dear  Mr.  President: 

We  have  the  pleasure  to  transmit  herewith,  pursuant  to 
Senate  Resolution  23,  Appendix  B  to  the  final  Report  of  the 
Senate  Select  Committee  on  Secret  Military  Assistance  to  Iran 
and  the  Nicaraguan  Opposition.   We  will  submit  such  other  volumes 
of  Appendices  to  the  Report  as  are  authorized  and  as  they  become 
available. 


Sincerely, 


'j  (AjL 


6C-^w^      -       -  V 

Warren  B.  Rudman     v^^ 
Vice  Chairman 


III 


U.S.  HOUSE  OF  REPRESENTATIVES 

SELECT  COMMITTEE  TO  INVESTIGATE 

COVERT  ARMS  TRANSACTIONS  WITH  IRAN 

UNITED  STATES  CAPITOL 

WASHINGTON.  DC  20515 

(202)  225-7902 

March    1,     1988 


The  Honorable  Jim  Wright 
Speaker  of  the  House 
U.  S.  Capitol 
Washington,  D.  C.  20515 

Dear  Mr .  Speaker : 

Pursuant  to  the  provisions  of  House  Resolutions  12  and 
330  and  House  Concurrent  Resolution  195,  100th  Congress,  1st 
Session,  I  transmit  herewith  Appendix  B  to  the  Report  of  the 
Congressional  Committees  Investigating  the  Iran-Contra  Affair, 
House  Report  No.  100-433,  100th  Congress,  1st  Session. 

Appendix  B  consists  of  the  depositions  taken  by  the 
Select  Committees  during  the  investigation.  The  contents  of 
Appendix  B  have  been  declassified  fo^-Yelease  to  the  public. 


Lee  H.  Hamilton 
Chairman 


United  States  Senate 

Select  Committee  on  Secret  Military  Assistance 
To  Iran  and  the  Nicaraguan  Opposition 

Daniel  K.  Inouye,  Hawaii,  Chairman 
Warren  Rudman,  New  Hampshire,  Vice  Chairman 

George  J.  Mitchell,  Maine 

Sam  Nunn,  Georgia 
Paul  S.  Sarbanes,  Maryland 
Howell  T.  Heflin,  Alabama 
David  L.  Boren,  Oklahoma 

James  A.  McClure,  Idaho 

Orrin  G.  Hatch,  Utah 

William  S.  Cohen,  Maine 

Paul  S.  Trible,  Jr.,  Virginia 


Arthur  L.  Liman 
Chief  Counsel 

Mark  A.  Belnick  Paul  Barbadoro 

Executive  Assistant  Deputy  Chief  Counsel 

To  the  Chief  Counsel 

Mary  Jane  Checchi 
Executive  Director 

Lance  I.  Morgan 
Press  Officer 


VI 


United  States  House  of  Representatives 

Select  Committee  to  Investigate  Covert  Arms 
Transactions  with  Iran 

Lee  H.  Hamilton,  Indiana,  Chairman 
Dante  B.  Fascell,  Florida,  Vice  Chairman 

Thomas  S.  Foley,  Washington 

Peter  W.  Rodino,  Jr.,  New  Jersey 

Jack  Brooks,  Texas 

Louis  Stokes,  Ohio 

Les  Aspin,  Wisconsin 

Edward  P.  Boland,  Massachusetts 

Ed  Jenkins,  Georgia 

Dick  Cheney,  Wyoming,  Ranking  Republican 

Wm.  S.  Broomfield,  Michigan 

Henry  J.  Hyde,  Illinois 

Jim  Courter,  New  Jersey 

Bill  McCollum,  Florida 

Michael  DeWine,  Ohio 


John  W.  Nields,  Jr. 
Chief  Counsel 

W.  Neil  Eggleston 
Deputy  Chief  Counsel 

Kevin  C.  Miller 
Staff  Director 


Thomas  R.  Smeeton 
Minority  Staff  Director 

George  W.  Van  Cleve 
Chief  Minority  Counsel 

Richard  J.  Leon 
Deputy  Chief  Minority  Counsel 


VII 


United  States  Senate 


Select  Committee  on  Secret  Military  Assistance  to 
Iran  and  the  Nicaraguan  Opposition 


Arthur  L.  Liman 
Chief  Counsel 
Mark  A.  Belnick  Paul  Barbadoro 

Executive  Assistant  Deputy  Chief  Counsel 

to  the  Chief  Counsel 

Mary  Jane  Checchi 
Executive  Director 

Lance  I.  Morgan 
Press  Officer 

Associate  Counsels 


C.  H.  Albright,  Jr. 
Daniel  Finn 
C.  H.  Holmes 
James  E.  Kaplan 
Charles  M.  Kerr 
Joel  P.  Lisker 


W.  T.  McGough,  Jr. 
Richard  D.  Parry 
John  D.  Saxon 
Terry  A.  Smiljanich 
Timothy  C.  Woodcock 


Committee  Staff 


Assistant  Counsels 


Legal  Counsel 
Intelligence /Foreign 

Policy  Analysts 
Investigators 


Press  Assistant 
General  Accounting 
Office  Detailees 


Security  Officer 
Security  Assistants 


Chief  Clerk 
Deputy  Chief  Clerk 


Steven  D.  Arkin* 
Isabel  K.  McGinty 
John  R.  Monsky 
Victoria  F.  Nourse 
Philip  Bobbitt 
Rand  H.  Fishbein 
Thomas  Polgar 
Lawrence  R. 

Embrey,  Sr. 
David  E.  Faulkner 
Henry  J.  Fiynn 
Samuel  Hirsch 
John  J.  Cronin 
Olga  E.  Johnson 
John  C.  Martin 
Melinda  Suddes* 
Robert  Wagner 
Louis  H.  Zanardi 
Benjamin  C. 

Marshall 
Georgiana 

Badovinac 
David  Carty 
Kim  Lasater 
Scott  R.  Thompson 
Judith  M.  Keating* 
Scott  R.  Ferguson 


Staff  Assistants 


Administrative  Staff 


Secretaries 


Receptionist 
Computer  Center 
Detailee 


John  K.  Appleby 
Ruth  Balin 
Robert  E.  Esler 
Ken  Foster* 
Martin  H.  Garvey 
Rachel  D.  Kaganoff* 
Craig  L.  Keller 
Hawley  K. 

Manwarring 
Stephen  G.  Miller 
Jennie  L.  Pickford* 
Michael  A.  Ray  nor 
Joseph  D. 

Smallwood* 
Kristin  K.  Trenholm 
Thomas  E.  Tremble 
Bruce  Vaughn 
Laura  J.  Ison 
Hilary  Phillips 
Winifred  A.  Williams* 
Nancy  S.   Durflinger 
Shari  D.  Jenifer 
Kathryn  A.  Momot 
Cindy  Pearson 
Debra  S.  Sheffield* 
Ramona  H.  Green 
Preston  Sweet 


VIII 


Committee  Members'  Designated  Liaison 


Senator  Inouye 
Senator  Rudman 

Senator  Mitchell 

Senator  Nunn 

Senator  Sarbanes 
Senator  Heflin 


Peter  Simons 
William  V.  Cowan 
Thomas  C.  Polgar 
Richard  H. 
Arenberg 
Eleanore  Hill 
Jeffrey  H.  Smith 
Frederick  Millhiser 
Thomas  J.  Young 


Senator  Boren 

Senator  McClure 
Senator  Hatch 

Senator  Cohen 

Senator  Trible 


Sven  Holmes 
Blythe  Thomas 
Jack  Gerard 
Dee  V.  Benson 
James  G.  Phillips 
James  Dykstra 
L.  Britt  Snider 
Richard  Cullen 


Part  Time* 


Assistant  Counsel 
Hearings  Coordinator 
Staff  Assistants 


Interns 


Peter  V.  Letsou 
Joan  M.  Ansheles 
Edward  P. 

Flaherty,  Jr. 
Barbara  H.  Hummell 
David  G.  Wiencek 
Nona  Balaban 
Edward  E. 

Eldridge,  III 
Elizabeth  J.  Glennie 
Stephen  A.  Higginson 
Laura  T.  Kunian 
Julia  F.  Kogan 
Catherine  L.  Udell 


Document  Analyst 

Historian 

Volunteers 


Lyndal  L.  Shaneyfelt 
Edward  L.  Keenan 
Lewis  Liman 
Catherine  Roe 
Susan  Walsh 


♦The  staff  member  was  not  with  the  Select  Committee  when  the  Report  was  filed  but  had,  during 
the  life  of  the  Committee,  provided  services. 


IX 


United  States  House  of  Representatives 


Select  Committee  to  Investigate 
Covert  Arms  Transactions  with  Iran 


Majority  Staff 


Special  Deputy 

Chief  Counsel 
Staff  Counsels 


Press  Liaison 
Chief  Clerk 
Assistant  Clerk 
Research  Director 
Research  Assistants 


John  W.  Nields,  Jr. 
Chief  Counsel 

W.  Neil  Eggleston 
Deputy  Chief  Counsel 

Kevin  C.  Miller 
Staff  Director 


Charles  Tiefer 

Kenneth  M.  Ballen 
Patrick  J.  Carome 
V.  Thomas 

Fryman,  Jr. 
Pamela  J. 

Naughton 
Joseph  P.  Saba 
Robert  J.  Havel 
Ellen  P.  Rayner 
Debra  M.  Cabral 
Louis  Fisher 
Christine  C. 

Birmann 
Julius  M. 

Genachowski 
Ruth  D.  Harvey 
James  E.  Rosenthal 


Systems 

Administrator 
Systems 

Programmer/ 

Analysts 
Executive  Assistant 
Staff  Assistants 


Catherine  L. 

Zimmer 
Charles  G.  Ratcliff 
Stephen  M. 

Rosenthal 
Elizabeth  S.  Wright 
Bonnie  J.  Brown 
Christina  Kalbouss 
Sandra  L.  Koehler 
Jan  L.  Suter 
Katherine  E.  Urban 
Kristine  Willie 
Mary  K.  Yount 


Minority  Staff 


Associate  Minority 

Counsel 
Assistant  Minority 

Counsel 
Minority  Research 

Director 


Thomas  R.  Smeeton 
Minority  Staff  Director 

George  W.  Van  Cleve 
Chief  Minority  Counsel 

Richard  J.  Leon 
Deputy  Chief  Minority  Counsel 


Robert  W. 
Genzman 
Kenneth  R.  Buck 

Bruce  E.  Fein 


Minority  Staff 
Editor/Writer 

Minority  Executive 
Assistant 

Minority  Staff 
Assistant 


Michael  J.  Malbin 

Molly  W.  Tully 

Margaret  A. 
Dillenburg 


Committee  Staff 


Investigators 


Director  of  Security 


Robert  A. 

Bermingham 
James  J.  Black 
Thomas  N. 

Ciehanski 
William  A.  Davis, 

III 
Clark  B.  Hall 
Allan  E.  Hobron 
Roger  L.  Kreuzer 
Donald  Remstein 
Jack  W.  Taylor 
Timothy  E.  Traylor 
Bobby  E.  Pope 


Security  Officers 


Editor 

Deputy  Editor 
Associate  Editor 
Production  Editor 
Hearing  Editors 

Printing  Clerk 


Rafael  Luna,  Jr. 
Theresa  M.  Martin 
Milagros  Martinez 
Clayton  C.  Miller 
Angel  R.  Torres 
Joseph  Foote 
Lisa  L.  Berger 
Nina  Graybill 
Mary  J.  Scroggins 
David  L.  White 
Stephen  G.  Regan 
G.  R.  Beckett 


Associate  Staff 


Representative 
Hamilton 

Representative 
Fascell 

Representative 

Foley 
Representative 

Rodino 

Representative 

Brooks 
Representative 

Stokes 
Representative 

Aspin 


Michael  H. 

Van  Dusen 
Christopher  Kojm 
R.  Spencer  Oliver 
Bert  D.  Hammond 
Victor  Zangla 
Heather  S.  Foley 
Werner  W.  Brandt 
M.  Elaine  Mielke 
James  J. 

Schweitzer 
William  M.  Jones 

Michael  J.  O'Neil 
Richard  M.  Giza 
Richard  E.  Clark 
Warren  L.  Nelson 


Representative 

Boland 
Representative 

Jenkins 
Representative 

Broomfield 
Representative 

Hyde 
Representative 

Courter 
Representative 

McCollum 
Representative 

DeWine 
General  Counsel  to 

the  Clerk 


Michael  W.  Sheehy 

Robert  H.  Brink 

Steven  K.  Berry 
David  S.  Addington 
Diane  S.  Doman 

Dennis  E.  Teti 

Tina  L.  Westby 

Nicholas  P.  Wise 

Steven  R.  Ross 


XI 


Contents 

Volume  19 


Preface XXI 

Miller,  Richard  R 1 


XIII 


Depositions 


Volume  1 


Airline  Proprietary  Project  Officer. 
Alvarez,  Francisco  J. 
Allen,  Charles. 
Arcos,  Cresencio. 


Volume  2 


Volume  3 


Armitage,  Richard. 
Artiano,  Martin  L. 
Associate  DDO  (CIA). 
Baker,  James  A.,  III. 
Barbules,  Lt.  Gen.  Peter. 
Bamett,  Ana. 
Bartlett,  Linda  June. 
Bastian,  James  H. 
Brady,  Nicholas  F. 
Brown,  Arthur  E.,  Jr. 


Byrne,  Phyllis  M. 
Calero,  Adolfo. 
Castillo,  Tomas  ("W"). 
Cave,  George  W. 
C/CATF. 


Volume  4 

Channell,  Carl  R. 

Chapman,  John  R.  (With  Billy  Ray  Reyer). 

Chatham,  Benjamin  P. 

CIA  Air  Branch  Chief. 

CIA  Air  Branch  Deputy  Chief. 

CIA  Air  Branch  Subordinate. 

CIA  Chief. 

CIA  Communicator. 

CIA  Identity  "A". 


XV 


Volume  5 

CIA  Officer. 

Clagett,  C.  Thomas.  Jr. 

Clark,  Alfred  (With  Gregory  Zink). 

Clarke,  George. 

Clarridge.  Dewey  R. 

Cline,  Ray  S. 

C/NE. 

Cohen,  Harold  G. 

Volume  6 

Collier,  George  E. 

Cole,  Gary. 

Communications  Officer  Headquarters,  CIA. 

Conrad,  Daniel  L. 


Volume  7 


Cooper,  Charles  J. 
Coors,  Joseph. 
Corbin,  Joan. 
Corr,  Edwin  G. 
Coward,  John  C. 
Coy,  Craig  R 
Crawford,  Iain  T.R. 


Crawford,  Susan. 
Crowe,  Adm.  William  J. 
Currier,  Kevin  W. 
DCM,  Country  15. 
DEA  Agent  1. 
DEA  Agent  2. 
DEA  Agent  3. 
deGraffenreid,  Kenneth, 
de  la  Torre,  Hugo. 
Deputy  Chief  "DC". 


Duemling,  Robert  W. 
DIA  Major. 
Dietel,  J.  Edwin. 
Dowling,  Father  Thomas. 
Dutton,  Robert  C. 
Earl,  Robert. 


Volume  8 


Volume  9 


XVI 


Farber,  Jacob. 
Feldman,  Jeffrey. 
Fischer,  David  C. 
Floor,  Emanuel  A. 
Former  CIA  Officer. 
Fraser,  Donald. 
Fraser,  Edie. 
Fuller,  Craig  L. 


Volume  10 


Volume  11 


Furmark,  Roy. 

Gadd,  Richard. 

Gaffney,  Henry. 

Gaffney,  Henry  (With  Glenn  A. 

Galvin,  Gen.  John  R. 

Gantt,  Florence. 

Garwood,  Ellen  Clayton. 

Gast,  Lt.  Gen.  Philip  C. 

Gates,  Robert  M. 

Glanz,  Anne. 


Rudd). 


Volume  12 


George,  Clair. 
Godard,  Ronald  D. 
Godson,  Roy  S. 
Golden,  William. 
Gomez,  Francis  D. 
Goodman,  Adam. 
Gorman,  Paul  F. 
Graham,  Daniel  O. 
Gregg,  Donald  P. 
Gregorie,  Richard  D. 
Guillen,  Adriana. 


Hakim,  Albert. 


Hall,  Wilma. 
Hasenfus,  Eugene. 
Hirtle,  Jonathan  J. 
Hooper,  Bruce. 


Volume  13 


Volume  14 


XVII 


Hunt,  Nelson  Bunker. 
Ikle,  Fred  C. 
Jensen,  D.  Lowell. 
Juchniewicz,  Edward 
Kagan,  Robert  W. 
Keel,  Alton  G. 
Kellner,  Leon  B. 
Kelly,  John  H. 
Kiszynski,  George. 


Koch,  Noel  C. 
Kuykendall,  Dan  H. 
Langton,  William  G. 
Lawn,  John  C. 
Leachman,  Chris  J.,  Jr. 
Ledeen,  Michael  A. 


Lei  want,  David  O. 
Lilac,  Robert  H. 
Lincoln,  Col.  James  B. 
Littledale,  Krishna  S. 
McDonald,  John  William. 
McFarlane,  Robert  C. 
McKay,  Lt.  Col.  John  C. 
McLaughlin,  Jane  E. 


McMahon,  John  N. 
McMahon,  Stephen. 
McNeil,  Frank. 
Makowka,  Bernard. 
Marostica,  Don. 
Marsh,  John. 
Mason,  Robert  H. 


Meese,  Edwin  IIL 
Melton,  Richard  H. 
Merchant,  Brian  T. 
Meo,  Philip  H. 
Miller,  Arthur  J. 
Miller,  Henry  S. 
Miller,  Johnathan. 


Volume  15 


Volume  16 


Volume  17 


Volume  18 


XVIII 


Miller,  Richard  R. 


Motley,  Langhorne  A. 
Mulligan,  David  R 
Nagy,  Alex  G. 
Napier,  Shirley  A. 
Newington,  Barbara. 
North,  Oliver  L. 
O'Boyle,  William  B. 
Osborne,  Duncan. 
Owen,  Robert  W. 
Pena,  Richard. 
Pickering,  Thomas. 
Poindexter,  John  M. 


Posey,  Thomas  V. 
Powell,  Gen.  Colin  L. 
Price,  Charles  H.,  II. 
Proprietary  Manager. 
Proprietary  Pilot. 
Radzimski,  James  R. 
Ramsey,  John  W. 
Ransom,  David  M. 


Volume  19 


Volume  20 


Volume  21 


Volume  22 


Raymond,  Walter,  Jr. 

Regan,  Donald  T. 

Reich,  Otto  J. 

Revell,  Oliver  B. 

Reyer,  Billy  Ray  (See  John  Chapman). 

Reynolds,  William  B. 


Volume  23 


Richard,  Mark  M. 
Richardson,  John,  Jr. 
Robelo,  Alfonso. 
Robinette,  Glenn  A. 
Rodriguez,  Felix  I. 
Roseman,  David. 


XIX 


Rosenblatt,  William. 

Royer,  Larry. 

Rudd,  Glenn  A. 

Rudd,  Glenn  A.  (See  Henry  Gaffney). 


Rugg,  John  J. 
Russo,  Vincent  M. 
Sanchez,  Nestor. 
Scharf,  Lawrence. 
Schweitzer,  Robert  L. 
Sciaroni,  Bretton  G. 
Secord,  Richard  V. 


Shackley,  Theodore  G. 
Sigur,  Gaston  J. 
Simpson,  Major  C. 
Sinclair,  Thomas  C. 
Singlaub,  John  K. 


Slease,  Clyde  H.,  IIL 
Smith,  Clifton. 
Sofaer,  Abraham  D. 
Steele,  Col.  James  J. 
Taft,  William  H.,  IV. 
Tashiro,  Jack  T. 
Teicher,  Howard. 
Thompson,  Paul. 
Tillman,  Jacqueline. 


Volume  24 


Volume  25 


Volume  26 


Volume  27 


Thurman,  Gen.  Maxwell. 

Trott,  Stephen  S. 

Tull,  James  L. 

Vessey,  John. 

Walker,  William  G. 

Watson,  Samuel  J.,  III. 

Weinberger,  Caspar. 

Weld,  William. 

Wickham,  John. 

Zink,  Gregory  (See  Alfred  Clark). 


XX 


Preface 


The  House  Select  Committee  to  Investigate  Covert  Arms  Transactions  with  Iran 
and  the  Senate  Select  Committee  on  Secret  Military  Assistance  to  Iran  and  the 
Nicaraguan  Opposition,  under  authority  contained  in  the  resolutions  establishing 
them  (H.  Res.  12  and  S.  Res.  23,  respectively),  deposed  approximately  290 
individuals  over  the  course  of  their  10-month  joint  investigation. 

The  use  of  depositions  enabled  the  Select  Committees  to  take  sworn  responses 
to  specific  interrogatories,  and  thereby  to  obtain  information  under  oath  for  the 
written  record  and  develop  lines  of  inquiry  for  the  public  hearings. 

Select  Committees  Members  and  staff  counsel,  including  House  minority 
counsel,  determined  who  would  be  deposed,  then  sought  subpoenas  from  the 
Chairmen  of  the  Select  Committees,  when  appropriate,  to  compel  the  individuals 
to  appear  in  nonpublic  sessions  for  questioning  under  oath.  Many  deponents 
received  separate  subpoenas  ordering  them  to  produce  certain  written  documents. 

Members  and  staff  traveled  throughout  the  United  States  and  abroad  to  meet 
with  deponents.  All  depositions  were  stenographically  reported  or  tape-recorded 
and  later  transcribed  and  duly  authenticated.  Deponents  had  the  right  to  review 
their  statements  after  transcription  and  to  suggest  factual  and  technical  correc- 
tions to  the  Select  Committees. 

At  the  depositions,  deponents  could  assert  their  fifth  amendment  privilege 
to  avoid  self-incrimination  by  refusing  to  answer  specific  questions.  They  were 
also  entitled  to  legal  representation.  Most  Federal  Government  deponents  were 
represented  by  lawyers  from  their  agency;  the  majority  of  private  individuals 
retained  their  own  counsel. 

The  Select  Committees,  after  obtaining  the  requisite  court  orders,  granted 
limited  or  "use"  immunity  to  about  20  deponents.  Such  immunity  means  that, 
while  a  deposed  individual  could  no  longer  invoke  the  fifth  amendment  to  avoid 
answering  a  question,  his  or  her  compelled  responses— or  leads  or  collateral 
evidence  based  on  those  responses— could  not  be  used  in  any  subsequent  criminal 
prosecution  of  that  individual,  except  a  prosecution  for  perjury,  giving  a  false 
statement,  or  otherwise  failing  to  comply  with  the  court  order. 

An  executive  branch  Declassification  Committee,  located  in  the  White  House, 
assisted  the  Committee  by  reviewing  each  page  of  deposition  transcript  and  some 
exhibits  and  identifying  classified  matter  relating  to  national  security.  Some 
depositions  were  not  reviewed  or  could  not  be  declassified  for  security  reasons. 

In  addition,  members  of  the  House  Select  Committee  staff  corrected  obvious 
typographical  errors  by  hand  and  deleted  personal  and  proprietary  information 
not  considered  germane  to  the  investigation. 

In  these  Depositions  volumes,  some  of  the  deposition  transcripts  are  follow- 
ed by  exhibits.  The  exhibits— documentary  evidence— were  developed  by  Select 
Committees'  staff  in  the  course  of  the  Select  Committees'  investigation  or  were 
provided  by  the  deponent  in  response  to  a  subpoena.  In  some  cases,  where  the 
number  of  exhibits  was  very  large,  the  House  Select  Committee  staff  chose  for 
inclusion  in  the  Depositions  volumes  selected  documents.  All  of  the  original 


XXI 


exhibits  are  stored  with  the  rest  of  the  Select  Committees'  documents  with  the 
National  Archives  and  Records  Administration  and  are  available  for  public  in- 
spection subject  to  the  respective  rules  of  the  House  and  Senate. 

The  27  volumes  of  the  Depositions  appendix,  totalling  more  than  30,000  pages, 
consist  of  photocopies  of  declassified,  hand-corrected  typewritten  transcripts 
and  declassified  exhibits.  Deponents  appear  in  alphabetical  order. 


XXII 


Publications  of  the  Senate  and  House 
Select  Committees 


Report  of  the  Congressional  Committees  Investigating  the  Iran-Contra  Affair, 
1  volume,  1987. 

Appendix  A:  Source  Documents,  2  volumes,  1988. 
Appendix  B:  Depositions,  27  volumes,  1988. 
Appendix  C:  Chronology  of  Events,  1  volume,  1988. 
Appendix  D:  Testimonial  Chronology,  3  volumes,  1988. 

All  publications  of  the  Select  Committees  are  available  from  the  U.S. 
Government  Printing  Office. 


XXIII 


.1 


82-724  0-88-2 


pbl 


mjUU  KCKMTHO  CO..  MC 
".07  C  Sinn    N  E 
Vtshxa<ton.  D  C      20002 
(202)  M«.iM< 


UNCUSSIF![e 


SELECT  COMMITTEE  TO  INVESTIGATE  COVERT 

ARMS  TRANSACTIONS  WITH  IRAN 

U.S.  HOUSE  OF  REPRESENTATIVES 

and 

SELECT  COMMITTEE  ON  SECRET  MILITARY  ASSISTANCE 

TO  IRAN  AND  THE  NICARAGUAN  OPPOSITION 

UNITED  STATES  SENATE 

Washington,  D.C. 
Tuesday,  June  23,  1987 

The  deposition  of  RICHARD  R.  MILLER,  called  for 

examination  in  the  above-entitled  matter,  pursuant  to  notice, 

in  the  offices  of  the  Senate  Select  Committee,  Room  901,  Hart 

Senate  Office  Building,  Washington,  D.C,  convened  at  2:42 

p.m.,  before  Pamela  Briggle,  a  notary  public  in  and  for  the 

District  of  Columbia,  when  were  present  on  behalf  of  the 

parties: 


UiSSlFlEO 


pb2 


APPEARANCES ; 


Mmmm 


n 


On  Behalf  of  the  Select  Committee  on  Secret  Military 
Assistance  to  Iran  and  Nicaraguan  Opposition  of  the 
United  States  Senate: 

JAMES  E.  KAPLAN 

Associate  Counsel 

-and- 

W.  THOMAS  McGOUGH,  JR. 

Associate  Counsel 

Room  901 

Hart  Senate  Office  Building 

Washington,  D.C. 

On  Behalf  of  the  Select  Committee  to  Investigate  Arms 
Transactions  with  Iran  of  the  U.S.  House  of 
Representatives : 

PAMELA  J.  NAUGHTON 

Staff  Counsel 

-and- 

KENNETH  R.  BUCK 

Assistant  Minority  Counsel 

H-149,  United  States  Capitol 

Washington,  D.C. 

On  Behalf  of  the  Witness: 

EARL  C.  DUDLEY,  JR.  ESQUIRE 

-and- 

RONALD  G.  PRECUP,  ESQUIRE 

Nussbaum,  Owen  &  Webster 

One  Thomas  Circle 

Washington,  D.C.   20006 


KLLOt  KCPOKTMO  CO  ,  •«. 
507  C  Sucn.  N  E 
Waihiofioo.  D  C     10002 
(202)  M6-66M 


pb3 


UNCIASSIHDI 


WITNESS 

RICHARD  R.  MILLER 

By  Mr.  Kaplan 
By  Ms .  Naughton 
By  Mr.  Kaplan 
By  Mr.  Buck 


NUMBER 

Miller  1 
Miller  2 
Miller  3 


EXAMINATION 


EXHIBITS 


FOR    IDENTIFICATION 


UNCLASSIFIE! 


■LLVI  MVOmwO  CO..  MC. 
)07  C  Sirm.  N  E 
Vuhmtton.  O  C     i<X>02 
(202)  VM-MM 


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(:o2)  v«6-6oM  undci 


PROCEEDINGS 
Whereupon , 

RICHARD  R.  MILLER 
was  called  for  examination  by  counsel  for  the  committee,  and   i 
having  been  first  duly  sworn  by  the  notary  public,  was 
examined  and  testified  as  follows: 

EXAMINATION 
BY  MR.  KAPLAN: 
Q    Could  you  please  state  your  full  name  for  the 
record? 

A    Richard  Roderick  Miller. 

Q    Are  you  testifying  here  today,  Mr.  Miller,  pursuant 
to  grants  of  immunity  by  the  Senate  and  the  House  select 
committees  that  compel  your  testimony? 
A    I  am. 

MR.  KAPLAN:   And  I'm  going  to  mark  as  Exhibit  1  to 
this  deposition  a  copy  of  an  order  issued  by  the  United 
States  District  Court  for  the  District  of  Columbia  ordering 
Mr.  Miller  to  testify  at  proceedings  by  the  Senate  select 
committee,  and  also  providing  that  no  testimony  or  other 
information  compelled  under  this  order  may  be  used  against 
Mr.  Miller.   And  that's  a  paraphrase  of  the  order. 

Counsel  for  the  House  select  committee  appearing 
here  today  has  assured  Mr.  Miller's  counsel  that  the  House 
will  be  forwarding  a  copy  of  the  immunity  and  compulsion 


provWont  o(  CO.  123M 


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507  C  Street.  N  E  2  5 

Washjnttoi).  D  C      20002 
(202)  M6-MM 


IINCIASM 


order  that  the  House  select  committee  has  received  in 
connection  with  Mr.  Miller's  testimony  here  today. 

I  ask  the  reporter  to  mark  that  as  Miller  Deposition 
Exhibit  No.  1 

[Miller  Exhibit  No.  1  was 
marked  for  identification.] 
BY  MR.  KAPLAN: 

Q    Mr.  Miller,  did  you  meet  with  Colonel  North  on 
November  2  0th,  19  86? 

A     Yes. 
'"*Q  '*  And  at  whose  request  was  that  meeting  set  up? 

A    Mine. 

Q    And  why  did  you  request  a  meeting  with  Colonel 
North? 

A    We  had  been  in  discussion  for  some  time  about  the 
need  to  develop  a  public  affairs  and  congressional  effort  on 
behalf  of  the  Nicaraguan  resistance,  the  unified  Nicaraguan 
opposition. 

Q    Were  you  also  concerned  that  a  contra  supply 
netfwork  that  you  participated  in,  which  we'll  get  into  later 
during  your  testimony,  was  unraveling  to  some  extent,  or 
might  unravel? 

A    I  wouldn't  characterize  it  that  way.   There  were 
events  taking  place  in  the  United  States  that  I  thought  made 
it  possible  that  both  he  and  I  would  be  drawn  into  a  legal 


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)07CStrt«.  NE  25 

Wuhioitoo.  D  C     20002 
(202)  M6-6««« 


UNCLASSIFIE! 


situation . 

Q    And  are  the  events  to  which  you're  referring,  the 
disclosure  of  the  arms  sales  to  Iran  with  questions  directed 
at  you  about  provision  of  assistance  to  the  resistance  in 
Nicaragua? 

A    Again,  I  wouldn't  characterize  it  that  way.   It  was 
more  a  case  of  a  closer  scrutiny  of  Colonel  North's  activities 
and  the  dredging  up  by  the  media  of  previous  newspaper  • 
accounts  of  his  assistance  through  private  individuals  to  the 
resistance  movement. 

Q    Where  did  that  meeting  take  place? 

A     In  his  office  in  the  Old  Executive  Office  Building 
and  also  in  the  corridor. 

Q    Was  there  anyone  in  his  office  when  you  arrived  at 
the  OEOB? 

A    As  I  recall,  I  waited  for  some  time,  which  was 
customary  in  those  meetings  --  probably  30  minutes  or  so. 
And  he  finally  came  out  of  his  door  and  shut  it  behind  him  in 
such  a  way  that  I  was  not  able  to  see  who  was  in  the  office. 
And  it  was  clear  he  was  doing  it  so  that  I  wouldn't  know  who 
was  in  the  office. 

Q    And  did  you  ask  him  who  was  in  the  office? 

A    I  did  not. 

Q    And  did  he  tell  you  who  was  in  the  office? 


No. 


ltNr.1  ASSIFIEI 


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HUfK  RCPOdTINO  CO  .  IMC 

507  C  SurtI    N  E  2  5 

Wuhingtoo    D  C      20002 
(202)  V46'6«6« 


Q    And  then  I  take  it  you  proceeded  to  have  a  conver- 
sation with  Colonel  North  in  the  corridor  outside  his  office? 

A    He  said,  let  me  walk  you  to  the  elevator.   And  we 
talked  briefly  about  the  establishment  of  the  UNO  public 
affairs  and  congressional  effort.   And  I  then  raised  the 
question  of  potential  future  legal  ramifications  for  myself 
and  my  firm,  and  then  ultimately  for  him. 

Q    Did  you  express  to  him  that  you  were  concerned 
about  revelations  that  had  appeared  in  the  press  relating  to 
closer  scrutiny  of  his  activities? 

A    Yes,  but  my  grfanary  departure  point  in  the  conver- 
sation was  about  the  lawsuit  that  had  taken  place  in  Miami 
brought  by  the  Chrioticane  against  several  people  who  had  by 
that  point  been  named  as  people  supporting  the  Nicaraguan 
movement.   And  my  concern  was  that  as  the  scrutiny  of  his 
activities  broadened,  eventually  several  other  people  would 
probably  be  drawn  into  it.   It  had  notlEteerf^ismissed  by  a 
federal  judge,  and  therefore,  anybody  involved  should  be 
ready  to  defend  themselves  in  federal  court. 

Q    And  you  considered  yourself  somewhat  involved? 

A    I  did. 

Q    And  what  was  the  substance  of  the  discussion  you 
had  with  Colonel  North  about  potential  need  for  you  for  a 
legal  defense? 

A    Well,  I  toId^h^fn.itiM^^'lfN^"'^  *^he  people  involved 


\m\mm 


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HUXEIt  REPORTINa  CO  .  INC. 
507  C  StitCT.  N  E  25 

WuhiOfton.  D  C      20002 
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UNOUSSffl 


through  my  activities,  I  expected  it  would  cost  a  considerable, 
amount  of  money,  and  he  asked  how  much.   And  I  said,  I  would 
expect  it  to  be  at  least  a  quarter  of  a  million  dollars,  and 
that  doesn't  even  take  you  into  account.   And  his  response  to 
that  was,  don't  worry  about  me.  I 

No,  he  then  asked  how  much  was  in  the  account,  and  i 
I  said  about  $200,000.  But  I  said,  that  doesn't  even  take  i 
care  of  you.  And  he  said,  don't  worry  about  me,  you  keep  it  I 
for  legal  costs.  ; 

Q     And  when  Colonel  North  asked  you  how  much  was  in 
the  account,  was  it  your  understanding  that  the  account  he 
was  referring  to  were  maintained  by  Cayman  Islands'  corpora- 
tions under  your  control?  , 

A     Yes . 

Q    And  were  those  accounts  maintained  in  Cayman         ! 
Islands'  financial  institutions?  i 

A    The  one  he  would  have  been  specifically  referring 
to  would  have  been  the  Intel  Co-Operation  account  at  Barclay's  j 
Bank,  although  he  at  that  time  did  not  know  it  was  Barclay's 
BanTc.  j 

Q    But  he  did  know  that  it  was  the  Intel  Co-Operation   I 
account?  j 

A    Yes .  I 

Q  Was    there   anything  more   to   that   evening? 

A  That   was    aboyt  .ttifi  AntWqi6iffi*fc       I    think   I    left.       It 


mtm 


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UmXMK  mMMITMa  CO  .  MC. 
107  C  Sinn   N  E  25 

Wiihiii(ioo   D  C     20001 
(1021  Vtt'MM 


MNCUSSIFI 


wasn't  very  long. 

Q    You  went  down  the  elevator? 

A    Yes. 

Q    Did  anyone  else  either  participate,  or  to  your 
knowledge  overhear  your  conversation  in  the  corridor? 

A    Not  that  I'm  aware  of. 

Q    Did  Colonel  North  stay  on  the  floor  on  which  his 
office  was  when  you  went  down  the  elevator? 

A    I  really  don't  recall. 

Q    But  he  didn't  go  out  with  you? 

A    No. 

Q    Did  you  then  meet  with  Colonel  North  on  the  next 
day,  November  21,  1986? 

A     I  did. 

Q    And  who  initiated  that  meeting? 

A  Colonel  North  called  me,  which  was  unusual,  for  a 
meeting  and  said  that--his  question  to  me,  as  I  recall  now 
was,  did  we  finish  what  you  needed  to  talk  about  yesterday. 
And  I  said,  no.  And  he  said,  then  why  don't  you  come  over. 
And  I  think  it  took  several  attempts  to  get  there,  and  that 
again  wasn't  unusual.   Things  on  his  schedule  changed  rapidly. 

Q    When  you  several  attempts  to  get  there,  you're 
referring  to  changed  times  in  the  agreed  upon  meeting? 

A    Correct. 


Q     Do  you  recall  what  t 


Colonel  North  called 


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■LLC*  MCrOOnHO  CO..  INC. 
507  C  Sum.  N  E  25 

Vuhjofion.  D  C      :0002 
(202)  V«6-M6« 


yNClASSIFIE 


10 


you  to  set  up  this  meeting? 

A    I  don't.   I  recall  that  when  I  got  there  it  was 
dark  and  it  was  rainy.   So  I  would  put  it  some  time  in  the 
late  evening. 

Q    The  meeting  took  place  in  the  late  evening.   And 
what  I  was  asking  is  whether  you  had  any  recollection  as  to 
the  time  of  day  of  Colonel  North's  initial  phone  call  to  you 
to  set  up  the  meeting? 

A    As  I  sit  here,  not  specifically,  no. 

Q    What  about  generally?   Was  it  morning,  afternoon, 
before  lunch,  after  lunch? 

A     I  don't  have  a  specific  recollection  of  when. 

Q  How  many  phone  calls  would  you  say  intervened 

between  the  initial  phone  call  and  the  meeting  taking  place? 

A     It  seems  to  me  it  got  postponed  twice.   There  were 
two  instances  involving  some  change  in  time.   It  may  have 
been  changed  and  then  changed  back.   I'm  not  sure.   But  I 
remember  twice  there  was  some  change  in  the  schedule. 

Q    And  the  meeting  then  occurred  some  time  in  the  late 
afternoon  or  early  evening? 

A    Well,  it  was  late.   I  was  able  to  park  on  G  Street. 
It  was  dark  and  it  was  raining.   So  I  would  it  probably  some 
time  after  5:00. 

Q    And  where  did  the  meeting  actually  take  place? 

A    I  went  to  his  office.   Again,  I  waited  briefly. 


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Ml  C  Sucn.  N  E  25 

Vuhtfifton.  D  C      Z0002 
(202)  V«6'6«6« 


yNCUSSiFlE 


11 


And  he  came  out  and  we  exchanged  greetings.   I  don't  recall 
what  we  specifically  said,  but  he  was  in  effect  already 
packing  up.   He  was  packing  his  briefcase  and  putting  on  his 
coat.   And  he  said,  why  don't  you  give  me  a  ride  and  I  told 
him  I  would  do  that. 

So  we  talked  on  the  way  to  the  car.   But  I  suspect 
only  as  far  as  the  door,  because  it  was  pouring  down  rain,  as 
I  recall.   And  we  probably  then  didn't  restart  our  conversa- 
tion until  we  got  in  the  car. 

Q    Did  he  say  where  he  wanted  you  to  give  him  a  ride 
to? 

A    He  said  he  wanted  a  ride — I  don't  remember  specifi- 
cally, but  it  was  a  general  area,  like  Dupont  Circle  or 
something  like  that.   I  recall  where  I  dropped  him  off. 

Q    Did  you  then  proceed  to  drive  him  towards  Dupont 
Circle? 

A    I  did. 

Q    And  can  you  tell  us  about  the  substance  of  the 
conversation  that  you  had  with  Colonel  North? 

A    I  was  trying  to  tell  him  that  I  felt  that  the 
effort — I  had  previously  told  him  I  thought  the  effort  would 
be  a  minimum  of  $2.5  million,  and  potentially  as  high  as  $5 
million  if  it  was  done  correctly. 

Q    Now  what  effort  are  you  referring  to? 

A    Public  relations  and_pubJ.ic  affairs  and  congres- 


lic  relations  and  publ^  affaii 


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sional  activities  on  behalf  of  UNO.   And  that  I  felt  that  it 
had  to  be  paid  for  with  money  that  came  from  outside  the 
United  States.   That  it  should  not  be  money  raised  by  American 
citizens,  it  should  come  from  foreign  donors. 

And  that  was  the  substance  of  what  I  was  telling 
him  this  time,  that  for  someone  to  raise  that  money  would 
make  them  a  foreign  agent.   I  didn't  think  that  was  a 
comfortable  position  for  people,  and  I  thought  it  unlikely 
they  could  raise  that  amount  of  money  for  that  kind  of 
effort,  and  couldn't  somebody  be  contacting  the  likes  of  "the 
Sultan  or^^^^^^^^^^^^^^^^^^or  people 

caliber  of  financial  capacity. 

Q    What  was  his  response  to  that  query  of  yours? 

A    As  I  recall,  the  exchange  that  happened  just  as  he 
exited  my  car--it  was  a  very  short  ride.   There  was  almost  no 
one  on  the  road.   He  said  that — I  said  to  him,  can't  somebody, 
can't  Shultz  or  somebody  contact^^^^^^^Hand  ask  them  to 
put  up  this  money?   And  his  response  was,  I  gave  one  to 
Shultz  already  and  he  fupked  it  up. 

Q    And  did  you  unSderstand  what  he  was  referring  to  by 
that  comment? 

A    No. 

Q    Did  you  ask  him  what  he  was  referring  to? 

A    No. 

Q    At  some  other  point  in_  the  .c^pt^ride,  did  North 


other  point  in  ti 

mf\  AQQ5 


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■•i''. 


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indicate  to  you  that  the  Attorney  General  had  suggested  that 
he  get  legal  advice.? 

A    As  I  recall  sometime  in  that  period,  either  the  day 
before  that  day  he  had  told  me  that  the  Attorney  General--but 
I  don't  recall--that  the  Attorney  General  had  suggested  that 
he  get  legal  counsel . 

Q    And  did  he  say  why  the  Attorney  General  suggested 
he  get  legal  counsel? 

A    No. 

Q    Did  he  mention  to  you  when  the  Attorney  General 
suggested  to  him  that  he  get  legal  counsel? 

A    No. 

Q    Did  you  have  an  impression  as  to  when  the  Attorney 
General  might  have  suggested  to  him  that  he  obtain  legal 
counsel? 

A    No,  not  really. 

Q    Did  he  describe  to  you  anything  more  about  the 
substance  of  his  conversation  with  the  Attorney  General? 

A    No. 

Q    Did  you  ask  him  why  the  Attorney  General  suggested 
that  he  get  legal  counsel? 

A    No.   It  wasn't  that  long  a  conversation. 

Q    Do  you  recall  when  Colonel  North  related  to  you 
that  the  Attorney  General  suggested  that  he  obtain  legal 


counsel? 


«HM«' 


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(202)  Vt6-«666 


UNCUSSI 


r 


u 


A    Again,  it's  the  same  answer  as  before.   I'm  not--    : 
it's  one  of  those  two  days. 

Q  And  by  those  two  days  you're  referring  to  Thursday, 
November  20th,  198^  or  Friday  the  21st? 

A    Thursday  or  Friday,  right. 

Q  And  so  it  would  have  been  either  in  the  corridor,  I 
take  it,  on  Thursday,  November  20th,  or  in  the  car  on  Friday, 
November  21st?  . 

A     I  would  think  so,  yes. 

Q     You  recall  that  he  related  the  Attorney  General's    i 
suggestion  to  you  in  a  face-to-face  conversation  as  opposed 
to  over  the  phone? 

A    Yes.  I 

I 

Q    Did  Colonel  North  say  anything  else  to  you  about 

Secretary  of  State  Shultz  as  he  was  departing  the  car  on      I 

i 
Friday,  November  21?  i 

I 

A    Yes,  his  last  words  right  after  he  made  the         i 
statement  about  the  Secretary  not  succeeding  was,  he  said,  if  I 
Shultz  knew  that  the  Ayatollah  was  bankrolling  this  whole      \ 
thing  he'd  had  a  heart  attack,  or  a  coronary — I've  forgotten 
which.   With  that,  he  got  up  and  left  my  car. 

Q    Did  you  understand  what  reference  he  was  making  at 
the  time? 

A    No. 

Q    And  I  take  it  you  didn't  have  an  opportunity  to  ask 


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WuhiUfton.  DC      20QO: 
(202)  M6-6666 


him? 


BNtmSff® 


15 


A    No,  I  got  to  think  about  it  all  weekend.  ; 

i 
Q    And  did  you  ask  him  at  any  time  subsequently  to      | 

what  he  was  referring?  j 

A    Didn't  have  to.  i 

Q    Where  was  it  that  you  dropped  Colonel  North  off?  j 

A    It  was  an  office  building  on  the  north — I'm  sorry,  i 

the  southeast  side  of  Dupont  Circle.   And  I  think  the  address  | 

is  1800  Massachusetts. 

I 
Q    Let  the  record  reflect  there  are  four  buildings  on   | 

I 

the  corner  of  18th  and  Massachusetts.   One  of  them  is  the      | 

Selgrave  Club;  one  of  them  is  the  National  Trust  for  Historic  I 

Preservation;  one  of  them  is,  again  another  older  building, 

the  Yeater  Clinic;  and  one  of  them  is  a  new  office  building, 

eight  stories  high^  that  is  1800  Massachusetts  Avenue, 

i 
sometimes  known  as  the  National  Rural  Electrical  Cooperative   I 

I 
Association  building.  | 

And  I  take  it  that  your  recollection  is  that  you 
dropped  him  off  at  the  new  office  building,  which  is  1800 
Massachusetts  Avenue? 
A    Correct. 

MR.  KAPLAN:   I  have  no  further  questions  on  those 
two  areas.   To  accommodate  Ms.  Naughton  who's  here  on  behalf 
of  the  House  select  committee,  we've  covered  those  two  areas 
first,  a  little  out  of  <y:d|u:«^M^jRi?pt  am  going  to  have 


\\m  i^^m 


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Wuhinfiofi.  D  C      :0002 
(202)  M6'6«66 


UNtUSSlffi 


y 


16 


questions  going  to  some  background  issues  and  then  one  other 
area  that  we'd  like  to  put  on  the  record  today. 

So  I  will  break  my  questioning  here  and  turn  it 
over  to  Ms.  Naughton  as  to  whether  she  has  any  further 
questions  on  the  events  occurring  on  November  20th  and 
November  21st. 

MS.  NAUGHTON:   Thank  you  very  much. 

EXAMINATION 
BY  MS.  NAUGHTON: 

Q     Mr.  Miller,  you  mentioned  this  November  20th 
meeting  with  Oliver  North,  sort  of  in  the  corridor  of  the 
OEOB.   Do  you  recall  what  time  of  day  this  was? 

A    I'm  not  sure,  but  I  think  it  was  the  afternoon. 

Q    When  you  mentioned  the  legal  problems  that  may  be 
involved  with  the  lawsuit  and  so  forth  and  he  said  don't 
worry  about  me.   Did  he  tell  you  why  you  shouldn't  worry 
about  him? 

A    No. 

Q    Was  that  his  last  comment  that  you  can  recall? 

A    Yes. 

Q    Did  he  ever  indicate  to  you  that  he  foresaw  that  he 
had  legal  problems? 

A    No,  he  didn't  indicate  it  but  I  think  it  was  clear 
to  both  of  us  at  that  point  that  he  probably  did  have  some 


legal  problems. 


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Q    Did  you  ever  discuss  with  him  what  those  were 
specifically? 

A    Well,  in  specific  terms  the  only  thing  we  discussed  ' 

was  the  lawsuit  in  Miami.  j 

Q    Did  Mr.  North  ever  tell  you  that  he  had  consulted 
with  any  attorney? 

A    He  told  me--I've  heard  him  use  that  phrase  once,  I  i 
think,  that  he  had  consulted  with  an  attorney,  prior  to  that 

Friday  evening.   But  I  can't  tell  you  where  specifically  or  i 

when  specifically.  i 

Q     But  the  consultation  was  sometime  within  that  time? 

In  other  words,  we're  not  talking  about  two  years  before  then?  ; 

A    I  would  say  it  was  within  six  months  of  that  period  | 
at  least. 

Q    Now  when  you  saw  him  on  November  21st  outside  of  | 

his  office  or  as  he  was  leaving  his  office,  can  you  recall  j 

what  your  conversation  was  in  the  hallway?  ! 

A    We  had  already  begun  talking  about  the  need  to  have  ! 

a  public  affairs  and  congressional  liaison  operation,  and  the  | 

need  for  it  to  be  staffed  and  the  level  of  cost  associated  | 

with  it.   It  was  my  primary  reason  for  seeing  him  on  Thursday,  j 

and  this  was  a  subsequent  discussion  about  the  same  thing.  | 

I 

Q    When  he  mentioned  that--01iver  North  had  said  that  I 

I 

the  Attorney  General  suggested  he  get  legal  counsel,  do  you  | 


recall  how  that  subject  came  up? 


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A    It  was  an  offhand  comment  by  him,  and  I  don't  think 
it  fit  in  real  well  with  whatever  the  conversation  was, 
because  I  don't  recall  a  conversation  about  the  subject.   It 
seems  to  me  it  was  an  offhand  comment  he  made. 

Q     Can  you  visualize  where  you  were  when  he  made  that 
comment? 

A    I  can't  specifically  for  you. 

Q    Did  it  arise  in  the  context  of  your  activities 
involved  in  supporting  the  freedom  fighters  in  Nicaragua? 

A    Again,  I  don't  have  a  specific  memory  trigger  on 
the  conversation.   I  don't--I  remember  it  as  an  offhanded 
comment.   I  don't  remember  it  as  part  of  a  continuing 
conversation. 

Q    Had  he  discussed  the  Attorney  General  with  you 


No. 


This  was  his  first  reference  to  the  Attorney 


before? 
A 
Q 
General? 

A    That  I  remember,  yes. 

MS.  NAUGHTON:   Thank  you.   I  have  no  further 
questions. 

EXAMINATION 
BY  MR.  KAPLAN: 
Q    One  further  question  on  this  topic.   Did  North  tell 
you  why  he  was  goin^  _to^  1^00  Magsagbysetts  Avenue? 


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Wuhinftoo    O  C      1M02 
(202)  >4»-«M« 


No 


HNClASSm 


19 


Q    And  you  didn't  ask  him?  | 

I 
A     No.  I 

Q    Now  we'll  switch  gears,  and  I'm  going  to  go  into 

some  background  information.   Are  you  currently  employed,  Mr.  | 

Miller?  j 

A    I  am.  j 

Q    And  where  are  you  employed?  | 

i 
A    I'm  a  senior  partner  at  International  Business       I 

Communications.  | 

i 
Q    And  for  how  long  have  you  been  employed  there?      | 

A    Four  years  almost.  j 

I 
Q    Did  you  work  for  a  period  of  time  in  1979,  1980  as   | 

a  director  of  broadcast  services  in  the  Reagan  for  President   | 

campaign? 

A    I  did.  ! 

Q    And  after  the  1980  election,  did  you  work  for  the    I 

I 
Reagan  transition  team?  I 

I 
A    I  did.  j 

i 
Q    And  sometime  shortly  thereafter,  did  you  take  a 

position  as  special  assistant  to  the  director  of  public 

affairs  at  the  Department  of  Transportation? 

A    Yes . 

Q    And  for  how  long  were  you  employed  in  that  position? 

A    Two  months 


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<202l  M6-6M« 


UNCLASSIFIED 


20 


Q    From  thereafter,  which  I  take  it  was  around 
February  1981  until  February  of  1983,  did  you  serve  as  chief 
of  news  and  public  affairs  for  the  Agency  for  International 
Development? 

A    Chief  of  news  and  media  relations  for  one  year,  and 
then  the  director  of  public  affairs  for  another. 

Q    So  I  kind  of  got  the  two  combined.   Then  did  you 
start  International  Business  Communications  as  a  sole 
proprietorship  in  early  1984? 

A     Yes . 

Q    And  did  IBC  become  a  partnership  comprised  of 
Miller  Communications  and  Gomez  International  in  1986? 

A    Correct. 

Q    And  did  you  incorporate  Miller  Communications  in 
early  1986? 

A    Yes. 

Q    And  was  Gomez  International,  to  your  knowledge, 
also  incorporated  in  early  1986? 

A    Yes. 

Q    And  again,  to  your  knowledge,  is  Frank  Gomez  the 
principal  in  Gomez  International? 

A    Yes. 

Q    Was  a  purpose  of  incorporating  Miller  Communications 
and  Gomez  International  to  restructure  an  ongoing  business 


relationship  you  had  with  Fr 


ou  had  with  r'"m''  iVlilfMl  a 


nd  to  form  the 


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(202)  V4i-«6M 


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partnership  of  International  Business  Conununications?         | 
A    That  was  one  of  the  reasons,  yes.  \ 

Q     Has  IBC--ancl  I'm  referring  to  International  i 

Business  Conununications  by  that  shorthand--since  its  inception] 
generally  engaged  in  media  relations,  strategic  planning  for  I 
public  affairs,  political  analysis,  and  executive  branch       i 

liaison?   Is  that  a  fair  characterization  of  IBC's  business?   : 

I 

A    That  is  a  fair  characterization  of  most  of  IBC's     | 
business.  i 

Q    Would  you  like  to  add  to  that?  j 

i 
A    We've  done  some  consulting  on  international  trade    ! 

I 

and  development  as  well.  j 

Q  And  in  or  about  the  spring  of  1985,  did  IBC  take  on  j 
as  a  client  American  Conservative  Trust,  which  was  a  political | 
action  committee  that  had  been  established  by  Carl  R. 
Channell? 

A    Yes.   Did  you  say  May? 

Q    Spring  of  1985.   Is  that  accurate? 

A    Yes. 

Q  And  at  some  time  shortly  thereafter,  did  National 
Endowment  for  the  Preservation  of  Liberty,  another  Channell 
organization,  also  become  a  client  of  IBC's? 

A    They  were  virtually  one  and  the  same  for  our 
purposes . 

Q    So  they  became  clients  at_di3out  the  same  time  in 


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Vuhioctoa.  0  C      20002 


ONCLASS 


22 


the  spring  of  1985? 


A    Yes,  m  the  spring  of  1985. 

[Witness  and  counsel  conferring.] 

A    I  think  for  your  record,  it  would  be  important  to 
point  out  that  we  worked  for  several  of  the  Channell  organiza- 
tions and  it  was  Mr.  Channell's  responsibility  to  decide  how 
the  work  product  was  applied  to  his  organization.   So  NEPL, 
National  Endowment  for  the  Preservation  of  Liberty,  came 
along  later  than  ACT,  the  American  Conservative  Trust. 

Then  there  were  subsequent  organizations,  who  we 
also  provided  work  product  to. 

Q    Let's  just  establish  for  the  record  that  when  we 
refer  to  IBC,  we're  referring  to  International  Business 
Communications  and  when  we  refer  to  NEPL  or  N-E-P-L,  we're 
referring  to  the  National  Endowment  for  the  Preservation  of 
Liberty. 

A    Yes. 

Q    Was  Daniel  Conrad  an  executive  director  of  NEPL  at 
the  time  that  NEPL  became  a  client  of  yours? 

A    Yes . 

Q    At  or  about  the  same  period  of  time,  was  IBC 
performing  a  variety  of  public  relation  functions  for  the 
Nicaraguan  Development  Council? 

A    Yes. 

Q    How  long  had  IBC  been  engaged  in  those  public 


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relations  activities? 

A    A  little  less  than  a  year. 

Q    At  or  about  that  same  period  of  time,  and  I  am 
talking  about  the  spring  of  1985,  were  you  also  dealing  with 
Lieutenant  Colonel  North  on  matters  relating  to  the  Nicaraguan 
situation? 

A    We  were  dealing  with  Colonel  North  on  matters 
relating  to  the  Nicaraguan  situation  and  other  Central 
American  issues . 

Q    In  or  around  early  April  1985  did  you,  Frank  Gomez, 
Carl  Channell  and  Dan  Conrad  meet  over  dinner  in  Washington, 
D.C.  with  John  Ramsey  of  Wichita  Falls,  Texas? 

A     Yes. 

Q    Was  the  purpose  of  that  dinner  to  solicit  Mr. 
Ramsey  to  provide  monetary  support  to  Adolfo  Calero  and  the 
Nicaraguan  Development  Council? 

A    Yes. 

Q  At  the  dinner,  were  certain  military  needs  of  the 
resistance  discussed,  including  small  arms,  ammunition,  and 
red  eye  missiles? 

A    I  wouldn't  use  your  characterization  of  needs.   The 
types  of  weapons  they  were  using,  how  they  were  supplying   ■■- 
themselves,  what  use  they  were  making  of  them,  all  those 
things  were  discussed. 


To  the  best  of  you 


UMM 


.dge,  did  Mr.  Ramsey 


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subsequently  make  a  contribution  to  the  Nicaraguan  Development  i 
Council?  ; 

A    Yes .  I 

Q    Do  you  recall  how  much  that  contribution  was?        ! 

A  It  seems  to  me  --  my  memory  is  not  clear  on  this,  i 
but  I  think  it  was  $20,000. 

Q  Was  it  your  understanding  that  that  contribution  j 
was  made,  at  least  in  part,  as  a  result  of  the  dinner  that  we  ] 
just  discussed,  in  early  April,  1985?  i 

A     Yes . 

Q     In  early  June,  1985  or  maybe  it  was  late  May,  did 
you  receive  a  call  from  Colonel  North  regarding  a  sum  of 
money  needed  by  the  Nicaraguan  resistance? 

A    I  believe  it  was  the  very  beginning  of  June. 

Q    Did  North  indicate  to  you  that  the  resistance 
needed  $50,000? 

A    As  I  recall,  he  was  looking  immediately  for 
$30,000. 

Q    Did  he  say  something  like  $30,000  would  be  neat  or 
something  to  that  effect? 

A  I'm  aware  of  what  you're  referring  to,  but  that's  a  I 
subsequent  conversation.  But  $30,000  was  the  figure  he  was  j 
searching  for.  I 

Q     Did  he  give  you  the  number  of  an  account  into  which 


any  money  solicited  for  the  ne^d  ih<jn_ld  be  deposited? 


LCitea  tor  the  ne^d  ij 


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(2021  M6-6666 


UNCLASSIFEO 


25 


A  Yes.  I 

Q  Did  North  indicate  to  you  for  what  specific  purpose 

the  money  was  needed? 

A  Just  that  it  was  general  assistance  to  resistance  j 

offices.  I 

Q  Did  you  ask  for  the  specific  purpose,  beyond  that?  ! 

A  I  don't  recall  asking  for  it.  i 

Q  You  referring  to  a  subsequent  telephone  conversation! 

a  moment  ago.   when  did  that  conversation  take  place?         I 

I 
A    At  a  later  point,  he  asked  me  to  transfer  money      j 

under  my  control  to  an  account  which  was  the  same  account. 

In  that  instance,  he  gave  me  those  instructions  that  you  just  1 

talked  about.  i 

MR.  KAPLAN:   I'm  going  to  ask  the  reporter  to  mark,  I 

as  Deposition  Exhibit  Number  2,  a  copy  of  handwritten  notes    | 

i 
that  have  been  provided  to  us  by  your  counsel  in  response  to   j 

a  subpoena  issued  by  our  committee.  ! 

[Miller  Exhibit  Number  2 

was  marked  for  identification.]! 

BY  MR.  KAPLAN:  j 

i 
Q    I'd  ask  you  to  take  a  look  at  those  notes.   Were     | 

those  notes  prepared  by  you? 

A     Yes. 

Q    Is  that  your  handwriting? 


Yes. 


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Q    Were  those  notes  prepared  during  or  as  a  result  of 
a  phone  conversation  that  you  had  with  Colonel  North? 

A     I  can't  recall  whether  this  specific  note  was  a 
result  of  the  phone  conversation  or  a  meeting,  but  I  wrote  it  | 
down  from  information  he  gave  me.  [ 

Q  Would  this  have  referred  to  --  would  these  notes     ; 

have  been  taken  in  the  context  of  either  a  phone  conversation  i 
or  meetings  sometime  in  early  June,  1985?  j 

A    Yes.  i 

Q    Did  you  call  --  '     j 

A     I'm  sorry,  I  have  to  strike  that.   If  this  is  from 
the  period  I  believe  it  is,  it's  probably  July.   But  it's  the  i 
same  information  that  I  made  use  of  in  June.  j 

Q    In  early  June.   So  the  notes  might  have  been        | 
prepared  as  a  result  of  a  meeting  or  from  a  conversation  in 
early  July,  but  the  information  contained  in  the  notes  is 
pretty  much,  if  not  precisely  the  same  information  that 
Colonel  North  relayed  to  you  in  early  June? 

A    Correct. 

Q    Let's  stay  with  early  June.   Pursuant  to  Colonel 
North's  request  in  early  June,  did  you  then  call  John  Ramsey 
to  ask  him  to  contribute  toward  the  need  expressed  by  Colonel 
North? 

A    I  believe  I  called  Mr.  Channell  first  and  he  gave  me 
Mr.  Ramsey's  phone  numbejr  ^nj^  Ji,afl  a&jrfra  11  Mr.  Ramsey  directly. 


inone  nujni: 


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UKUK  Ktromma  co .  inc. 

507  C  Suc»t    N  E  25 

Vuhui|Ton.  D  C      iOOO! 
(;02)  546-6666 


UNCIiSSIFlEi 


27 


Q    And  you  did  then  call  Mr.  Ramsey? 

A    Yes. 

Q    Did  you  give  to  Mr.  Ramsey  the  account  information 
given  to  you  by  Colonel  North? 

A    I  did. 

Q  Did  you  later  learn  that  Mr.  Ramsey  had  deposited 
$10,000  directly  into  the  same  account,  about  which  you  had 
given  him  information? 

A    Yes. 

Q    That  was  the  information  about  the  account  that  you 
had  received  from  Colonel  North? 

A    Correct. 

Q    Did  you  prepare  and  send  a  mailgram  over  North's 
name  thanking  Ramsey  for  his  contribution? 

A    I  did. 

Q    Did  North  authorize  the  mailgram  to  be  sent? 

A    Yes . 

MR.  KAPLAN:   Can  I  ask  the  reporter  to  mark  as 
Exhibit  3  a  copy  of  a  mailgram  again  which  has  been  provided 
by  your  counsel  pursuant  to  subpoena  by  the  Sejjnate  Select 
Committee.  i 

[Miller  Exhibit  ilumber  3 
was  marked  for  identification. 
BY  MR.  KAPLAN: 

Q    Is  this  the  mailgrcim  to  which  I  justj|  referred  and 


his  the  mailgrcim  to  which 

iiMPi  hkmm 


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Hiu£R  utromma  CO..  mc. 

507  C  StKTl    N  E  25 

Wuhinpoo.  D  C     20002 
'2021  ^4A.AAAA 


UNCIASSIF 


r^ 


to  which  you  just  referred  in  your  testimony? 

A    Yes . 

Q    Just  for  the  record,  the  mailgram  reads  "Thank  you 
for  the  help  on  such  short  notice"  over  the  name  of  Colonel 
North  and  the  mailgram  is  sent  to  Mr.  John  Ramsey  in  Wichita 
Falls,  Texas.   Is  that  correct? 

A    Correct. 

Q    Do  you  recall  whether  you  gave,  to  Colonel  North,  a 
copy  of  this  mailgram? 

A    I  believe  I  did. 

Q  On  or  about  July  9,  1985,  did  you  participate  at  a 
meeting  at  the  Hay-Adams  Hotel  with  Mr.  Channell,  Mr.  Conrad 
and  Colonel  North? 

A    Yes . 

Q    Was  the  purpose  of  that  meeting  that  Mr.  Channell 
wanted  to  ensure  that  money  that  had  been  contributed  by  NEPL 
contributors  for  the  benefit  of  the  Nicaraguan  resistance 
was,  in  fact,  being  used  for  that  purpose? 

A  He  wanted  to  be  sure  that  it  was  being  sent  to  the 
correct  place. 

Q    At  that  meeting,  did  Mr.  Channel!  ask  Colonel  North 
where  contributions  for  the  resistance  should  be  directed  in 
the  future? 

A    Yes. 

Q    What  did  Colonel  North  respond? 


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■U-OI  nVOffTWO  CO..  MC. 

)07  C  Sbctt.  n  e  25 

Wuhiafion    O  C       20C02 


UNCUSSi 


29 


iL^i 


A    His  response  was  to  send  them  to  IBC. 

Q    Had  you  formed,  by  that  time,  a  Cayman  Islands 
corporation  known  as  I.C.,  Inc.? 

A    I  had. 

Q    Was  I.e.,  Inc.  formed  for  reasons  unrelated  to  NEPL 
or  IBC's  efforts  on  behalf  of  the  Nicaraguan  resistance? 

A    Yes. 

Q    Was  Colonel  North  aware  of  the  existence  of  I.e., 
Inc.  before  the  July  9  dinner  or  meeting  to  which  we  just 
referred? 

A    Yes. 

Q    Was  the  ncirae  of  I.C.,  Inc.  changed  in  early  May, 
1986,  to  Intel  Co-Operation,  Inc.? 

A     Yes. 

Q  Pursuant  to  Colonel  North's  suggestion  at  the  July 
9  meeting  or  dinner,  did  NEPL  begin  to  make  payments  for  the 
Nicaraguan  resistance  to  IBC? 

A    Yes . 

Q    Did  NEPL  continue  to  make  such  payments  at  various 
times  though  the  fall  of  1986  to  IBC  and  to  Intel  Co-Opera- 
tion? 

A     Yes. 

Q  Did  you  make  various  disbursements  over  time  of 

those  NEPL  payments  to  IBC,  I.C.,  Inc.,  and  Intel  Co-Opera- 
tion? 


\Mussra 


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X)7CSaf«j.  NE  25 

Wutunftnn.  0  C     20002 
(202)  )46.<M« 


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sLnOw 


30 


L.jl^ 


Yes. 


Q    And  by  those  NEPL  payments,  we're  both  referring  to 
payinerits  made  by  NEPL  to  IBC  or  Intel  Co-Operation  to  support 
or  provide  assistance  to  the  Nicaraguan  resistance,  is  that 
correct? 

A    Yes. 

Q     In  almost  all  cases,  were  those  disbursements  made 
pursuant  to  a  direction  you  received  from  Colonel  North? 

A     Yes. 

Q    Were  those  disbursements  made  to  recipients  or  bank 
accounts  identified  by  Colonel  North? 

A     Yes. 

Q    At  the  time  that  those  disbursements  were  made,  is 
it  fair  to  say  that  you  did  not  ask  and  generally  were  not 
told  the  purpose  of  the  particular  disbursements? 

A    Could  you  repeat  your  question? 

Q    Yes,  I'm  sorry.   At  the  time  that  the  disbursements 
were  made,  that  is  the  disbursements  that  were  directed  by 
and  to  recipients  or  bank  accounts  identified  by  Colonel 
North,  is  it  fair  to  say  that  you  did  not  ask  and  Colonel 
North  never  told  you  what  the  purpose  was  of  those  disburse- 
ments? 

A    It's  not  a  fair  characterization.   It  varied  from 
time  to  time.   It  is  true  that  in  most  of  the  large  disburse- 


ments, I  did  not  know  the  identify  of  the  recipients. 


uNpi  mm 


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HU-EK  KCrORTINO  CO..  INC. 

!07  C  Suert.  N  E  25 

Wuhixjpon.  D  C      i0002 
(JO!)  5«.66«6 


UNCUSSIF 


V 


31 


Q     I  take  it  you  knew  the  identity,  but  you  didn't 
know  anything  beyond  the  simple  fact  of  the  identity? 

MR.  DUDLEY:   Could  we  go  off  the  record  for  a 
second? 

[Discussion  off  the  record.] 
BY  MR.  KAPLAN: 
Q    Mr.  Miller,  just  to  clarify  the  record,  it  might  be 
helpful  if  you  did  tell  us  what  you  knew  about  the  recipients 
of  money  from  IBC  or  Intel  Co-Operation  that  was  directed  by 
Colonel  North? 

A    It  varied  by  recipient.   The  largest  portion  of  the 
monies  received  by  Lake  Resources,  we  had  raised  for  specific 
activities,  such, as  resupply  operations.   But  how  it  was 
specifically  sent,  I  can't  tell  you. 

In  the  case  of  the  some  of  the  other  large  recipi- 
ents, such  as  Alpha  Services,  and  Mr.  Calero's  organizations, 
my  impression  --  the  information  that  I  got  from  Colonel 
North  about  the  money  transferred  was  very  small,  next  to 
nothing,  just  account  information. 


fT>/V 


(^) 


In  the  case  of  the  UNO  and  pW/tiNO  organizations,  I 
had  a  very  good  handle  on  the  money  that  was  being  --  the 
need  for  the  money  because  it  was  money  I  was  approached  for, 
and  then  there  was  a  variety  of  other  recipients  who  were 
directed  by  —  I  was  directed  by  Colonel  North  to  send  money 
to,  the  use  of  which  I  had  no  idea,  and  they  included  people 

UMPI  Accinrp 


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WIX£lt  RErODTINO  CO..  (NC. 

107  C  Sunt.  N  E  25 

Vuhui|ion     D  C       20002 
(2031  146  6666 


yNCUSSiffi 


32 


like  the  Latin  American  Strategic  Studies  Institute,  the 
Terrorism  and  Subnational  Conflict  Institute. 

I  generally  knew  who  these  people  were,  but  I 
didn't  have  any  idea  of  how  they  were  spending  the  money. 

Q     Were  approximately  $1.7  million  of  IBC  and  I.C., 
Inc.  disbursements  directed  by  Colonel  North  to  a  Swiss  bank 
account  held  by  Lake  Resources? 

A     Yes. 

Q    At  some  point  in  the  late  fall  or  early  winter  of 
1985,  did  Mr.  Channell  ask  you  to  have  North  prepare  and 
provide  a  list  of  big  ticket  items  needed  by  the  Contras? 

A    He  asked  me  to  get  from  Colonel  North  some  descrip- 
tion of  big  ticket  items  that  he  could  approach  contributors 
with. 

Q    And  was  there  a  bottom  line  dollar  aim  that  these 
big  ticket  items  should  add  up  to? 

A    Initially,  as  I  recall,  it  was  about  $1.2  million. 

Q     Did  you  understand  that  the  list  was  to  be  used  by 
Channell  to  solicit  contributions  for  that  resistance? 


A 
Q 
A 
Q 
to  you? 
A 


Yes. 

Did  you  relay  the  request  to  Colonel  North? 

Yes. 

Did  Colonel  North  then  orally  provide  such  a  list 

He  provided  orally  information  on  several  items 

JIMP!  AdQiprn 


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Mum  Ktronjwto  co..  mc. 
107  C  Sum.  N  E  25 

Vuhmfton.  O  C      20002 


UNCLASSIF 


33 


that  I  then  incorporated  into  a  list. 

Q    Did  you  enter  that  list  onto  your  computer  at  the 
time? 

A    I  did. 

Q     Do  you  recall  that  the  list  provided  by  Colonel 
North  orally  included  heavy  lifting  of  cargo  by  aircraft? 

A     Yes . 

Q    Did  the  list  from  Colonel  North  also  include  the 
training  and  outfitting  of  an  urban  tactics  unit? 

A    Yes. 

Q    Did  the  list  also  include  the  resupply  of  the 
resistance  unit  known  as  the  Larry  McDonald  Brigade? 

A    I  believe  so. 

Q    Do  you  believe  that  the  list  provided  orally  by 
Colonel  North  also  included  missiles  of  some  kind? 

A    I  believe  that's  true,  but  I  don't  have  a  copy  of 
the  list  anymore,  so  I  can't  point  to  it  specifically,  but  I 
did  discuss  specifically  with  Colonel  North  shoulder  launched 
surface  to  air  missiles. 

Q    Did  you  print  a  copy  of  that  list  from  your 
computer? 

A    Yes. 

Q    Did  you  provide  that  list  to  Channell? 

A    Yes. 


Did 


5t  from  your  computer? 


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ULLEU  KCPOimNa  CO-.  INC 

i07  C  Sirc«t.  N  E  2  5 

Vuhinpon    D  C      JOOO: 


Yes. 


UNCUSSIF 


34 


ILU 


Q    I  take  it  you  don't  have  a  copy  of  that  list  today? 

A     I  didn't  retain  a  copy  then. 

Q     Sometime  in  early  November,  1985,  did  you  par- 
ticipate in  a  solicitation  of  funds  from  Mrs.  Barbara 
Newington? 

A    I  participated  in  a  solicitation  of  Barbara 
Newington,  yes. 

Q     In  preparation  for  the  solicitation,  did  you 
prepare  a  file  folder  which  contained  a  picture  of  a  Soviet 
HIND  helicopter  on  one  side  and  a  picture  of  a  shoulder  held 
surface  to  air  missile  on  the  other  side? 

A    Yes. 

Q    Did  you  meet  with  Mrs.  Newington,  Mr.  Channel 1  and 
Colonel  North  in  a  suite  at  the  Hay-Adams  Hotel? 

A    Yes. 

Q    Do  you  recall  the  date  of  that  meeting? 

A     I've  been  subsequently  told  that  it  was  the  -- 

Q    November  7? 

A    7,  but  I'm  noc  quite  certain  about  it,  to  be  honest. i 

Q     You  recall  it  was  in  the  early  November  time  period? i 

A    No,  I  don't  specifically  recall  the  date,  but  I      I 
recall  the  meeting.  | 

Q    At  the  meeting,  did  Colonel  North  describe  to  Mrs.   i 
Newington  the  threat  posed  to  the  Nicaraguan  resistance  by     j 

IIMP!  Accrnrn 


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i07  C  Sottt    N  E  25 

Wiihin(lii«.  D  C      20002 
(2021  i*t-6666 


HIND  helicopters? 


ONCUSSIFIED 


35 


A     Yes. 

Q    Did  North  refer  to  the  file  folder  that  had  been 
prepared  by  you? 

A    Briefly. 

Q    Did  North  describe  the  capability  of  the  shoulder 
held  surface  to  air  missile  that  was  in  the  file  folder  to 
counteract  the  HIND  helicopter? 

A    He  did  refer  to  surface  to  air  missiles  but  only 
generally.   I  don't  think  he  specifically  referred  to  the  one 
in  the  folder. 

Q    When  you  said  before  that  Colonel  North  referred 
briefly  to  the  file  folder  that  you  had  prepared,  how  did  he 
refer  to  it? 

A    I  don't  remember  the  specific  conversation,  but  he 
was  describing  to  Mrs.  Newington  how  the  HIND  helicopters  had 
changed  the  battlefield  tactics  of  the  resistance  forces, 
breaking  them  into  smaller  units,  not  allowing  them  to  have 
large  collections  of  soldiers.   I  also  had  a  copy  of  a  New 
York  Times  piece  on  the  HIND  helicopter,  and  as  I  remember  he 
used  that  far  more  prominently  than  he  used  the  folder. 

Q    Did  Mrs.  Newington  ask  Colonel  North  if  he  knew 
where  to  obtain  surface  to  air  missiles? 

A    As  I  recall,  her  specific  question  was,  and  you 
know  where  to  get  these?   And  he  said  ves,  we  know. 


3t  these/   And  he  saidve 

\\m  h^MwA 


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WLiMH  HfrOfmNQ  CO  .  MC. 
W7  C  StK«   N  E  25 

Wishmflo"    D  C      20002 


ICUSSlFiEO 

Q    And  did  Colonel  North  quote  any  prices  to  Mrs. 
Newington? 

A     I  don't  recall. 

Q     Did  Mr.  Channel!  then  ask  Mrs.  Newington  if  she 
would  help  by  contributing  money  to  the  resistance? 

A  Are  you  asking  me  if  that  was  --  are  you  asking  in 
proper  time?  Because  I'm  not  sure  whether  Colonel  North  was 
still  in  the  room  at  the  time. 

Q    I  was  going  to  ask  you  was  Colonel  North  in  the 
room  when  Channell  asked  for  a  contribution? 

A  Colonel  North,  I  don't  think,  was  in  the  room  when 
Channell  asked  her  for  a  specific  contribution. 

Q    Do  you  know  whether  or  not  his  absence  from  the 
room  at  the  time  of  Channell 's  request  was  prearranged? 

A     I  don't  think  specifically,  but  it  was  his  practice 
not  to  be  in  the  presence  of  the  donor  when  they  were  asked 
for  money. 

Q    Just  so  we  clarify  the  record,  did  Channell  ask  Mrs. 
Newington  if  she  would  contribute  money  for  the  Contras? 

A     Yes. 

Q  And  did  Mrs.  Newington  indicate  whether  she  would 
contribute? 

A    Yes. 

Q  What   did   she    indicate? 

A  As    I    recall,    I'm   not    sure  jaihf A2>g>f    I    knew   it 


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507  C  Suttt    N  E  25 

Washin|iafl.  D  C     20002 
1202)  M«-MM 


37 


specifically  that  night  or  subsefoeatly/  but  it  was 

$1,200,000.  "        "'^  /^ 

Q    And  are  you  aware  that  Mrs.  Newington- later  made 

stock  contributions  to  NEPL  of  approximately  $1  million? 
A    Yes.      -   ^  ^^ 

Q    And^  are  you  aware  that  those  coatriButions  were 

made  sometime  within  the  next  four  to  six  weeks? 

A  Yes.  ^^p-    ^       "~  _ 

-^^^^     '■-'- 
Q  Were   those  cpntributipns^^'^^sequeatly  passed   to    IBC 

.^^. .--  _     _:^      " ' 
and   then  tcfeXt^,    Inc>    for  £uri;ea^le^Li^ia>vi.ding  assistance 

to   the   res-i*tWfce  mtwement-?-         --_        ^~"    '"  -f^- 

A  The9^^#ere  paaaed  t^  igj*JMn<f^thett"€Sey- were  passed 

on    for   the   resis%emc©^     Without   the   report   in   front  of   me,    I 

can't  tell   you -whet her^^iJ.  of    it  went   teJueeuoh   B^ ■  .    Inc.    or 

y  ha  ve  ~jjtop|^H*ec  ^^^^jJSSf. "  -  Res  ourcgs 

passed,    we^fia«*taTlld°  that   ^g,^^fet^^U^^6ei«r8^urned    from 
stock   into  ^ash  pr^or  to  ^s^lng  been   patraed  to   IBC? 

A  I   believe  that's   correct,    by  NEPI^     '~^^. 

Q  Wa8^_aiere   aH^me   after  NEPL  )ySg&l  making   payments 

to   IBC   and_I  .C  .^-Inc  .-aCo^  €fe  Eea«t.«ft^^mbvement ,    that   you 
discussed  witH^^^nel  No^h  your  desite  an?t"1rft#-<J5sire  of 
Frank  Gomez   to" receive  ^compensation  both   for  the  services   you 
were   performing   and   the   professionj^I   risk-involved    in   the 
tunneling   of    funds    to    the    resistance? 

uMni  aoosorp 


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Hiuzn  RcroHTiHa  co.,  mc. 

507CSUCT1    NE  25 

WuhmfTon.  D  C      20002 


UNCLASSIHE 


A     Yes. 

Q    When  did  you  have  that  discussion  with  Colonel 
North? 

A    Sometime  in  late  '85  or  very  early  in  '86. 

Q  Did  you  tell  Colonel  North  that  you  and  Mr.  Gomez 
wanted  to  receive  10  percent  of  the  NEPL  payments  that  were 
flowing  through  IBC  or  its  related  entities? 

A    That's  correct. 

Q    And  did  Colonel  North  agree  that  you  and  Mr.  Gomez 
could  deduct  10  percent  of  those  payments  as  compensation? 

A    Yes. 

Q    And  in  approving  that  compensation,  did  Colonel 
North  indicate  that  he  believed  that  10  percent  was  reason-    i 
able?  ; 

A    Yes. 

Q    Did  he  say  that  10  percent  was  reasonable  because    i 
most  of  the  other  people  in  the  business  of  providing 
assistance  to  the  Contras  were  taking  20  to  30  percent,  or 
something  to  that  effect? 

A    That's  almost  exactly  what  he  said.  ! 

Q    Did  you  ultimately  arrange  to  take  10  percent  of     ! 

the  contributions  that  flowed  through  IBC  and/or  its  related   | 

i 
entities?  j 

A    Yes . 

Q    Did  you  pay  that  amoup^  |.^f  fef^poration  that  you 


w\TOinFn^ 


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)07  C  Sum.  N  E  25 

VuhiniTon.  D  C      20002 
'  m!l  M6.6666 


mumi 


39 


established  in  the  Cayman  Islands  called  World  Affairs 
Counselors,  Inc.? 

A     Yes . 

Q     Did  they  money  that  went  into  ^rld  Affairs 
Counselors,  Inc.,  that  is  the  10  percent,  ultimately  find  its 
way  to  Miller  Communications  and  Gonea  International? 

A    ¥es*;^  "  „  -^ 

Q         -DidT-you  ever  *ell   Chanttellr"or~€onrad  that  you  were 
taking   the    fi^percent  cut"  from   the   contributions    that  were 
flowing   thro\^h.?      "g^  __  '^'-  _J_ 

-A         -r  did^fct  telt  Mr.   Chemnelli,  until   December  or 
January  of   this^ast  year."  .^ 

MR.    KAPlaN:       I   have   no    further  questions   under   our 
arrangement  wittr~your"=e©un3el=  to  call   you    in  on   such   short    ' 

'^3uei^.^^^^pyf%xpaiarcm£  reafeey^i^^^tcg^call  yo^&acK^at 
soWKs  later  _pSthf3n~€ime,    to  take  your  testfffibny  under  oath 
on   a   broader   range  of    issues.       I    juBt  want  to   state   that    for 

the   recoi?d.  ^=^ 

rr^is~the  short  notice  to  ^u  and  also  the  Tact 
that  we  know  that  you've  been  invoked  in  heavy  preparation 
and  grand  jury  testimony  recently,  wfiFch  led  us  ^tp  f*|Bit  our 
examinations  today  and  I  appreciate  you  and-your  counsel 
coming  down  here  and  I  apprec^te  ^our  cooperation  in 
responding  t^lW 


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UNWSSlFiEl) 


40 


I  don't  know  if  House  Minority  Counsel  has  any 
further  questions  but  I'll  leave  the  floor  to  him. 

MR.  BUCK:   I'd  just  like  to  ask  you  a  few  questions, 
Mr.  Miller. 

EXAMINATION 
BY  MR.  BUCK: 
Q    Did  you  know  Mr.  North  to  exaggerate  stories  at 
all?   Did  you  find  him  to  embellish  tales? 

A    I've  never  seen  any  indication  that  he  had  done 
that.   I've  seen  newspaper  accounts  of  it,  but  I've  never  had 
any  personal  experience  with  him  doing  that. 

Q    Did  you  know  that  Mrs.  Newington's  home  was 
searched  for  bugs,  for  electronic  eavesdropping  devices,  at 
one  time? 

A     Yes . 

Q    Did  you  feel  that  was  necessary? 
A    It  was  necessary  to  her,  so  we  accomplished  it. 
MR.  BUCK:   I  have  no  further  questions. 
[Whereupon,  at  3:44  p.m.,  the  taking  of  the 
deposition  was  concluded.] 


42 


pb59 


MILLf  R  MrO«TMO  CO  .  MC 
)07  C  Sircti,  N  E 
Wuhififion.  O  C      10001 


41 


CERTIFICATE  OF  NOTARY  PUBLIC 


I,  PAMELA  BRIGGLE,  the  officer  before  whom  the 
foregoing  deposition  was  taken,  do  hereby  certify  that  the 
witness  whose  testimony  appears  in  the  foregoing  deposition 
was  duly  sworn  by  me;  that  the  testimony  of  said  witness  was 
taken  by  me  and  thereafter  reduced  to  typewriting  by  me  or 
under  my  direction;  that  said  deposition  is  a  true  record  of 
the  testimony  given  by  the  witness;  that  I  am  neither  counsel 
for,  related  to,  nor  employed  by  any  of  the  parties  to  the 
action  in  which  this  deposition  was  taken;  and  further,  that 
I  am  not  a  relative  or  employee  of  any  attorney  or  counsel 
employed  by  the  parties  hereto,  nor  financially  or  otherwise 
interested  in  the  outcome  of  the  action. 


PAMELA  BRIGGLE 


Notary  Public  in  and  for  t!ie 
District  of  Columbia 


My  Commission  expires  May  14,  1990. 


inr 


\i\ii%  siu. 


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mxin  DvoiiTHa  co..  mc 

507  C  Succt,  N  E 
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UNCLASSIHED 


42    I 


SELECT  COMMITTEE  TO  INVESTIGATE  COVERT 
ARMS  TRANSACTIONS  WITH  IRAN 

UNITED  STATES  HOUSE  OF  REPRESENTATIVES 

AND 

SELECT  COMMITTEE  ON  SECRET  MILITARY  ASSISTANCE 
TO  IRAN  AND  THE  NICARAGUAN  OPPOSITION 

UNITED  STATES  SENATE 

Friday,  July  3,  1987 

Washington,  D.C. 

The  continued  deposition  of  RICHARD  R.  MILLER  was 

commenced  at  9=15  a.m.,  in  Room  901,  Hart  Senate  Office 

Building,  when  were  present: 

For  the  Senate  Select  Committee: 

THOMAS  MC  GOUGH,  ESQ. 
Associate  Counsel 

For  the  House  Select  Committee: 

KENNETH  R.  BUCK,  ESQ. 
Assistant  Minority  Counsel 

THOMAS  FRYMAN,  ESQ. 
Staff  Counsel 

FOR  THE  DEPONENT: 

RONALD  G.  PRECUP,  ESQ. 
ADINA  N.  AMITH,  ESQ. 
Nussbaum,  Owen  and  Webster 
1800  M  Street,  Northwest 
Washington,  D.C.   20036 
^  ■  Partially  Declassified/Released  on  Itj-eii  '  **  7 

'   :  '  under  provisions  of  E.G.  12356 

by  N.  Menan,  National  Security  Council 


UNOkSSW 


82-724    0044 


45 


inxut  KcrottTwa  eo..  inc. 

107  C  Screti.  N  E 

Tuhiopon.  D  C      :0002 


CONTENTS 


Examination  by  Counsel  for: 
House  Select  Committee  (Mr.  Buck) 
Senate  Select  Committee  (Mr.  McGough) 


EXHIBITS 


Miller  Deposition  Exhibits 

4 

5 

6 

7 


DMtUSSlFiED 


43    i 

i 
Page     j 

I 

4     I 

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31     j 

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For  Identification   i 

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mwssiniB 


PROCEEDINGS 

(9: 15    a.m. ) 

MR.  BUCK:   Let's  go  on  the  record. 

Mr.  Miller,  my  name  is  Ken  Buck  and  I  am  the 
Assistant  Minority  Counsel  with  the  House  Select  Conunittee, 
and  I'd  ask  everybody  at  the  table  to  just  introduce  them- 
selves, please. 

MR.  MC  GOUGH:   I'm  Tom  McGough,  Associate  Counsel 
to  the  Senate  Select  Committee. 

MR.  FRYMAN:   I'm  Thomas  Fryman,  Staff  Counsel  ro 
the  House  Committee. 

MS.  AMITH:   I'm  Adina  Amith,  an  associate  at 
Nussbaum,  Owen  and  Webster,  representing  Mr.  Miller. 

MR.  FRECUP:   I'm  Ronald  G.  Precup,  representing  Mr. 
Miller. 

MR.  MILLER:   I'm  Richard  R.  Miller,  witness. 

MR.  BUCK:   Mr.  Miller,  I'd  remind  you  that  you ' le 
under  oath.   This  is  a  continuation  of  your  previous  deposi- 
tion. 

At  this  time,  I'd  like  to  mark  the  order  from  the 
House  Select  Committee,  order  granting  immunity,  as  Exhibit  1 
in  the  Miller  deposition. 

MR.  MC  GOUGH:   Excuse  me.   If  we  are  making  this  a 
continuation  of  the  other  deposition,  there  is  already  a 
Deposj 


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<:02l  M6-6M6 


MR.  PRECUP:   Yes.   This  would  be  number  2. 
.  MR.  MC  GOUGH:   No.   We ' ve  got  1 ,  2 ,  3 .   This  should 
be  Deposition  E.xhibit  Number  4. 
MR.  PRECUP:   Number  4. 

[Whereupon,  the  document  was 
marked  as  Miller  Deposition 
Exhibit  No.  4  for  identifica- 
tion. ] 
Whereupon, 

RICHARD  R.  MILLER 
was  recalled  as  a  witness  and,  having  pre'/iously  been  duly 
sworn,  was  examined  and  testified  as  follows: 

EXAMINATION  BY  COUNSEL  FOR  THE  HOUSE  SELECT  COMMITTEE 
BY  MR.  BUCK: 
Q    Mr.  Miller,  are  you  a  partner  in  International 
Business  Communications,  or  IBC? 
A    Yes. 

Q     Is  IBC  a  political  and  media  consulting  firm? 
A    Among  other  things,  yes. 

Q    Since  graduating  from  the  University  of  Maryland  in 
1976,  have  you  been  employed  in  the  field  of  broadcast 
services  and  public  affairs? 
A     Yes. 

Q    Would  you  say  your  area  of  expertise  is  public 
affairs  or  fund-raising? 


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A     I  would  say  it's  public  affairs  and  business  and 
trade  promotion. 

Q    Before  April  1985,  how  many  fund-raising  jobs  had 
you  held? 

A    None . 

Q     Is  it  fair  to  say  that  your  greatest  exposure  to 
fund-raising  a  result  of  having  Mr.  Channell's  corporations 
as  clients? 

A    Greatest,  yes,  but  not  only. 

Q    What  other  exposures  have  you  had? 

A     I  was  exposed  to  it  during  the  Reagan  campaign  and 
I've  had  a  contract  with  a  couple  of  direct  marketing  firms. 

Q    Do  you  know  if  Colonel  North  was  a  fund-raiser  by 
profession  in  1985? 

A    No. 

Q    Did  Frank  Gomez  have  fund-raising  experience  before 
April  1985? 

A    Not  that  I'm  aware  of. 

Q    Did  you  know  of  Mr.  Channell's  fund-raising 
experience  when  you  met  him  in  early  1985,  or  did  you  learn 
of  it  soon  thereafter? 

A    I  learned  about  his  experience  in  the  spring  of 
1985. 

Q    Did  you  learn  about  Mr.  Conrad's  experience  also 
during  that 


::i  IJNCIASSIFIEO 


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m.m& 


A    Yes. 

Q    Did  yc'j  know  that  Mr.  Channell  and  Mr.  Conrad  had 
extensive  experience  raising  funds  for  tax-exempt  corpora- 
tions? 

A    Yes. 

Q    Did  you  believe  Mr.  Channell  and  Mr.  Conrad  would 
determine  the  legality  of  their  fund-raising  techniques? 

A    Yes. 

Q    Did  you  rely  on  Colonel  North  to  determine  the 
legality  of  the  expenditures  of  Lake  Resources? 

A    Yes. 

Q    Did  Mr.  Channell  discuss  weapons  needs  of  the 
Nicaraguan  resistance  with  potential  contributors? 

A    Yes. 

Q    Are  you  aware  of  Mr.  Channell  contacting  Colonel 
North  to  tell  Colonel  North  the  specific  weapons  which 
particular  contributors  donated  money  for? 

A    I  don't  have  any  direct  knowledge  of  that. 

Q    Is  Colonel  North  the  type  of  person,  in  your 
opinion,  to  buy  weapons  which  Mr.  Channell  told  him  he  should 
buy?   Can  you  answer  that? 

A    Yes,  easily.   No. 

Q    Okay.   Is  it  your  opinion  that  Mr.  Channell 
discussed  the  weapons  needs  of  the  Nicaraguan  resistance  with 
potential  contributors  as  a  fund-raising  technique? 


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omAssife 


A  Yes,    it's   possible. 

Q  Were  you  aware  that  the  National  Endowment  for  the 
Preservation  of  Liberty,  or  NEPL,  was  a  501(c)(3)  tax-exempt 
corporation? 

A    Yes. 

Q    When  did  you  become  aware  of  this? 

A     Probably  June. 

Q    Of?  i 

A     ',85. 

Q  Did  you  know  that  tax-exempt  corporations  can  only 
spend  their  money  for  limited  purposes? 

A    I  was  generally  aware  of  that  at  the  time. 

Q    What  is  your  understanding  of  those  limited 
purposes? 

A    Now,  it's  pretty  good,  but  back  then  it  was  that  it 
simply  could  not  be  used  for--my  only  concern  was  that  it  not 
be  used  for  things  that  would  violate  the  Neutrality  Act  of 
the  United  States  or  the  Export  Act,  Export  Control  Act. 

Q    Did  you  ever  tell  Mr.  Channell  to  use  NEPL,  as 
opposed  to  any  of  his  other  corporations,  for  the  purpose  of 
raising  money  for  the  Nicaraguan  resistance? 

A     No. 

Q    Did  you  ever  discuss  with  Mr.  Channell  the  ap- 
propriate Channell  organization  to  receive  money  raised  for 
the  resistance? 


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.  I  II  ^.Ml  II  II 

A     No. 

Q    Are  you  aware  of  Colonel  North  ever  advising  Mr. 
Channell  which  of  Mr.  Channell's  organizations  should  receive 
money  which  was  raised  for  the  Nicaraguan  resistance? 

A     I'm  not  aware  of  any  such  conversation. 

Q    Would  Colonel  North's  advice  on  this  matter  be 
inconsistent  with  the  division  of  responsibilities,  as  yoa 

saw  those? 

i 

A     Yes. 

Q    To  your  knowledge,  was  Colonel  North  involved  in 

j 
the  day-to-day  operation  of  any  tax-exempt  corporation?       i 

A     No.  ! 

Q    Was  Colonel  North  present  when  you  or  anybody  yc^u    i 

know  solicited  money  for  the  Nicaraguan  resistance? 

I 
A    In--let  me  think.   Once  he  was  present,  but  not  in   i 

i 

immediate  proximity.   On  another  occasion,  I  still  don't  have 

a  clear  recollection,  but  I  believe  he  left  the  room  before    I 

I 
the  actual  solicitation  took  place.  | 

I 
I 

Q    Was  it  Colonel  North's  practice  to  excuse  himself 

when  potential  contributors  were  being  solicited  for  money  on 

behalf  of  the  Nicaraguan  resistance? 

A     Yes,  and  initially  he  refused  to  even  be  present     I 

I 
during  solicitations.  I 

Q     Do  you  have  any  knowledge  that  Colonel  North  kne 

what  organizations  Mr.  Channell  or  his  employees  were 

?cM«i  Rooirirn 


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soliciting  money  for? 

A     I  don't  think  he  had  a  specific  knowledge  of  which 
organizations,  but  he  knew  Mr.  Channell  was  president  of 
NEPL,  National  Endowment  for  the  Preservation  of  Liberty. 

Q    Did  he  also  know  that  Mr.  Channell  was  president  of 
the  American  Conservative  Trust? 

A    Yes  - 

Q    Sentinel? 

A    Probably. 

Q     In  other  words,  Mr.  Channell  had  a  great  number  of 
corporations  that  he  could  have  been  raising  money  for,  and 
what  I'm  asking  is  did  Colonel  North  know  which  of  those 
corporations  he  was  raising  money  for? 

A    Besides  the  fact  that  I  think  you're  extending  the 
universe  on  this,  I  can't — I  know  he  knew  about  NEPL  and  I 
know  he  knew  about  ACT.   The  others,  I  can't  tell  you  because 
we  produced  commercials  that  had  ACT  on  them  initially  which 
he  had  seen,  and  National  Endowment  for  the  Preservation  of 
Liberty  was  prevalent  on  the  literature  that  he  saw  at  the 
time  of  summer  of  '85  and  into  '86. 

Q    My  question  is  whether  Colonel  North  knew  that  Mr. 
Channell  was  raising  money  for  a  tax-exempt  corporation. 

A    I  can't  speak  for  him  in  that  regard. 

Q    Do  you  know  specifically--. 

A    We  have  to  revisit  that  question. 


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Q  Okay,    let's. 

A   .  His  office,  particularly--I  think  it  was  Bob  Earl 
requested  a  list  of  tax-exempt  organizations  who  were  on  the 
Administration  side  of  the  issue  and  one  of  them,  as  I 
recall,  was  the  American  Conservative  Trust.   I  don't  think 
one  of  them  was  the  National  Endowment  for  the  Preservation 
of  Liberty. 

Q    Who  did  he  request  the  list  from? 
A    From  Tie.   He  asked  me  to  put  it  together,  so  he 
would  have  known  that  the  American  Conservative  Trust  was  a 
501(c),  whatever  it  was,  (6)  or  (4),  because  it  would  have 
been  on  the  list,  and  you  have  that  document  somewhere. 

Q    Okay.   You're  aware  that  Colonel  North  knew  that 
Mr.  Channell  was  raising  money  for  the  Nicaraguan  resistance? 
A    Yes. 

Q    And  you're  also  aware  that  Colonel  North  knew  that 
Mr.  Channell  had  a  few  organizations,  a  few  corporations? 
A    Yes. 

Q    Are  you  aware  of  whether  Colonel  North  knew  which 
organizations  Mr.  Channell  was  using  to  solicit  money  for  the 
Nicaraguan  resistance? 

A    I  don't  recall  a  specific  conversation  between 
North  and  myself  on  which  Channell  entity  was  raising  money. 

Q    Do  you  specifically  know  if  any  of  the  money  which   j 
was  received  by  International  Business  Communications,  IC,     i 


'■'.  -fW: 


->  /r 


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Inc.,  or  Intel  Cooperation,  or  which  was  distributed  to  other 
accounts  from  those  corporations  was  used  to  buy  weapons? 

A    I  don't  know.   I  think  the  vast  majority  of  it  was 
not,  and  I  think  I  can  prove  that  to  some  certainty. 

Q    But  my  question  has  to  do  with  the  time  frame 
within  which  the  money  was  being  raised.   At  that  time,  di<:l 
you  know  of  any  of  that  money  being  used  to  buy  weapons? 

A     At  that  time,  we  had  specifically  raised  SI  million 
for  weapons . 

Q    Thank  you,  and  did  you  spend  that  money  on  weapons? 
Did  you  personally  spend  that  money  on  weapons? 

A    No. 

Q    So,  to  your  knowledge,  the  money  was  spent--i.f  ir 
was  spent  on  weapons,  it  was  spent  on  weapons  by  someone  else? 

A    Correct. 

Q    And  the  money  was  out  of  your  control  when  it  was 
spent  on  weapons? 

A    Correct. 

Q     So  you  have  no  personal  knowledge  whether  money  was 
ever  spent  on  weapons,  or  do  you  have  any  personal  knowledge? 

A    No. 

Q    Let  me  ask  you  more  specifically,  do  you  have  any 
knowledge  of  whether  contributions  to  NEPL  were  used  to 
purchase  military  and  other  types  of  non-humanitarian  lid  for 
the  Contras?    HllinS  ft  00 


'  llNCi  AKfilPiLy 


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1  j      A    I  am  generally  aware  that  money  raised  by  NEPL  was 

2  '  used  in  the  air  resupply  operation,  which  would  have  been  a 

■i 

3  I  military  underta.king,  but  aside  from  that  I  don't  have  any-- 

:i 

4  j|      Q    Could  you  define  military  undertaking  for  me? 

5  I      A    There  was  initially  an  effort  to  deliver  the  27 

6  :  million  in  humanitarian  assistance  to  fighters  deep  inside 

7  ;!  Nicaragua,  and  then  eventually  it  was  a  full  resupply 
operation. 

9       Q    Delivering  lethal  and  non-lethal  aid? 

10  i      A    Correct . 

11  Q    Okay.   I  want  to  distinguish  between  a  delivery  of 

12  I  military  aid  and  necessarily  military. 

13  A    And  the  answer  is  no. 

14  Q    Okay,  if  you  buy  that  distinction,  if  you  agree 

15  with  that? 

16  A    I  not  only  agree  to  it;  it  was  exactly  what  was  the 

17  state  of  mind  at  the  time.   It  was  the  way  we  viewed  it. 

18  Q    That  an  air  resupply  was  not  a  military  operation? 

19  A    Was  not  military  aid;  it  was  not  lethal  aid.   It 

20  was  an  allowable  expense. 

21  Q    Of? 

22  A    Of  anybody  in  the  United  States  to  make.   It  wasn't 

23  in  violation  of  the  Neutrality  Act  and  was  not  in  violation 

24  of  the  Arms  Export  Act. 
Q 


Could  you  tell  me  how  you  developed  that  knowledge 

MAini  Aoosnrn 


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54 


or  opinion? 

A    My  general  discussion  with  Colonel  North,  discussion 
with  attorneys,  and  discussion  with  my  partner,  who  was  o  20- 
year  Foreign  Service  officer. 

Q     Did  Colonel  North  ever  show  you  a  legal  opinion 
from  a  Washington,  D.C.,  law  firm  which  discussed  that  issue? 

A     No. 

Q    Are  you  aware  of  whether  Colonel  North  may  have  had 
an  opinion  on  that  subject,  a  legal  opinion? 

A    Generally,  but  I  have  no  specific  knowledge  of  who 
the  law  firm  was  or  what  the  specifics  of  the  opinion  war, 
but  he  had  referenced  it  one  time. 

Q    Okay.   Do  you  know  of  any  contributions  to  NEFL 
which  were  solicited  and  were  ultimately  used  to  purchase 
military  and  other  types  of  non-humanitarian  aid  for  the 
Contras? 

A    Your  question  hinges  on  "ultimately  used, "  aside 
from  the  air  resupply  effort. 

Q    Was  it  the  intention  of  everybody  involved  to 
purchase  particular  weapons  with  particular  contributions  at 
the  time  that  the  money  was  being  raised? 

A    Again,  in  the  one  instance  in  which  we  were 
specific  about  weapons,  it  was  a  specific  contributor, 
specific  amount  for  a  specific  weapon. 

Q    And  what  contribution  was  that? 


pr?m^  *003r?rn 


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UNCLASSIFIED 


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1  I       A     That  was  Mrs.  Newington.   It  was  roughly  $1  million 

2  and  it  was  for  50  shoulder-launched. heat-seeking  ground-to- 

3  air  missiles . 
i 

4  Q    Are  you  aware  of  whether  that  money  was  used  to 

5  I  purchase  missiles? 

6  I      A    No.   In  fact,  that's  the  one  instance  in  which  I 
I 

7  !  asked  Colonel  North--l  had  seen  in  the  paper  and  on  tele- 

8  I  vision--I  read  everything  on  the  subject,  and  did  back  then 

9  as  well,  and  I  didn't  see  any  evidence  of  an  increase  in  the 

10  number  of  missiles  on  the  ground  and  the  Hind  helicopters 

o  - 

11  were  continuing  to  be  a  pretty  deadly  counter-f force . 

y 

12  And  I  asked  him  why  there  was  not  more  evidence  of 
! 

13  ]  missiles  and  his  response  was  they  didn't  need  the  missiles-- 


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they  needed  the  radios  more  than  they  needed  missiles.   They 
needed  these  more  than  they  needed  missiles,  and  he  brought 
out  a  brochure  which  was  of  some  kind  of  radio,  an  encrypted 
radio  of  some  kind. 

Q    Did  you  meet  Mr.  Channell  at  a  meeting  for  the 
Nicaraguan  refugee  dinner  in  early  1985? 
A    Yes. 

Q    Was  this  the  first  time  you  met  Mr.  Channell? 
Yes. 

Did  you  meet  Dan  Conrad  around  the  same  date? 
No. 


When  did  you  meet  Mr.  Conrad? 


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A     I  think  the  first  time  I  met  Conrad  was  when  he 
came  with  Channe.'.l  to  my  office. 

Q    Which  was? 

A     April . 

Q     Of  1983? 

A     Right. 

Q    Soon  after  the  Nicaraguan  refugee  dinner,  did  you 
receive  a  call  from  John  Roberts  in  which  he  told  you  that 
Mr.  Channejil  wanted  to  help  the  President  on  Nicaragua? 

A     Yes. 

Q  Was  it  your  impression  that  Mr.  Channell  wanted  to 
do  a  media  campaign  to  encourage  public  support  for  a  future 
Congressional  vote  on  Contra  aid? 

A     Yes. 

Q  Did  John  Roberts  indicate  to  you  that  Mr.  Channell 
expected  you  to  assist  Mr.  Channell  with  fund-raising? 

MR.  PRECUP:   Excuse  me.   I  think  you  misspoke.   You 
used  Channell  twice  in  that  sentence.   Would  you  just  repeat 
the  question? 

MR.  BUCK:   Sure. 
BY  MR.  BUCK: 

Q  Did  John  Roberts  indicate  to  you  that  Mr.  Channell 
expected  you  to  assist  Mr.  Channell  with  fund-raising? 

A     No. 

Q     What  involvement  did  you  have  in  assisting  Colonel 


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North  or  anyone  else  on  the  national  security  staff  with 
Central  American  issues  before  you  received  the  telephone 
call  from  John  Roberts? 

A    As  part  of  our  State  Department  contract,  we  had 
provided  escort  services  for  defectors  from  the  Nicaraguan 
government,  members  of  the  Nicaraguan  opposition,  internal 
opposition,  the  senior  political  figures  in  other  Central 
American  countries,  and  in  doing  that  we  had  come  into 
contact  with  Colonel  North. 

We  had  also,  under  instructions  from  Jonathan 

Miller,  worked  briefly  out  of  North's  office  on  securing 

'^ 
media  appearances  and  non\-media  meetings  for  Adolfo  Cal~5co, 

J- 

Arturo  Cruz,  and  Alfonso  P.ubello  when  they  came  to  Washington 
following  their  San  Jose  declaration. 

So  we  knew  Colonel  North  and  he  knew  of  our 
activities  prior  to  our  relationship  with  Channell. 

Q    What  did  John  Roberts  tell  you  concerning  Mr. 
Channell  when  he  called  you  the  first  time? 

A    That  he  used  to  be  one  of  the  NCPAC  people,  fairly 
high  up — I've  forgotten  how  he  exactly  characterized  him-- 
and  that  he  wanted  to  do  something  political  to  help  the 
President,  and  he  gave  me  the  name  of  the  organization  and 
told  me  that  it  was  a  federal  PAC  kind  of  like  NCPAC,  but 
only--the  difference  was  that  Channell  only  took  on  issues 
that  were  supportive  of  the  President  and  was  not  publicly 


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umissints 


critical  of  the  President,  even  though  he  may  have  differed 

I 
with  him  privately.  i 

So  his  objective  was  to  give  the  President  political' 

action  support  affirmatively  on  foreign  policy  issues  with     | 

which  he  agreed  with  the  President,  and  that  was  the  summation; 

of  what  Mr.  Roberts  told  me. 

Q    Were  there  other  groups  or  entities  that  were       j 

supporting  the  white  House  on  Central  American  policy  in      j 

similar  ways  that  you  were  during  this  time  frame?  | 


A     That  I  was? 

Q    Well,  that  IBC  was. 

A    Not  that  I'm  aware  of. 

Q    Okay. 

A    Not  in  the  way  IBC  did,  no;  not  as  a  contractor, 
no.   There  were  private  groups,  non|profit  types,  but  not 
corporations. 

Q    So  there  were  private  groups  that  were  assisting 
the  White  House  in  Central  American  policy? 

A    Several — many  would  be  a  better  term. 

Q    Were  you  involved  in  any  fund-raisdng  efforts  with 
Colonel  North  or  the  NSC  staff  before  you  received  the  call 

from  John  Roberts? 

I 
A     No.  I 

Q    Would  it  surprise  you  to  know  that  John  Roberts 

allegedly  referred  to  your  organization  as  t<he  White  House 


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59 


outside  the  white  House  on  the  Central  American  issue? 


Yes,  it  would  surprise  me. 

Would  that  be  an  accurate  statement? 

No. 

Have  you  known  John  Roberts  since  August  19  80? 

Yes  . 

Would  you  characterize  your  relationship  as  gor'd 


A 

Q 
A 

Q 

A 

Q 
friends? 

A    Yes. 

Q     Is  your  relationship  with  John  Roberts  over  the 
past  seven  years  such  that  he  may  have  tried  to  exaggerate 
your  importance  in  the  Central  American  area  to  convince  Mr. 
Channell  to  use  your  services? 

A    I  doubt  it. 

Q    Okay.   How  many  times  did  you  hear  Colonel  North's 
briefing  on  the  Nicaraguan  resistance  in  Central  America? 

A    Twenty  times,  probably. 

Q    Was  it  a  standard  briefing  or  were  there  radical 
changes  in  the  information  given  out? 

A    It  was  standard. 

Q    Did  you  participate  in  helping  Colonel  North 
develop  that  briefing  program? 

A    I  know  that  in  the  first  instance  of  my  seeing  it, 
some  of  the  pictures  he  used  were  pictures  Frank  Gomez  took 
at  the  camps  in  Honduras,  which  was  a  pleasant  surprise  for 


nna^  *-'^5nri^ 


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us,  and  then  much  later  in  '86  following  a  Channell  critique, 
I  suggested  to  Colonel  North  that  the  briefing  needed  to  be 
updated  and  he  asked  me  to  put  together  some  recommendations, 
which  I  did. 

Q    Who  did  Frank  Gomez  take  the  pictures  for? 

A    He  was  in--well,  for  himself,  but  he  was  in  the 
camps  as  a  result  of  our  State  Department  contract. 

Q    So  he  then  gave  those  pictures  to  the  State 
Department? 

A    He  gave  them  to  a  lot  of  people.   He  just  made 
multiple  sets  and  provided  them  to  people. 

Q    Okay.   Would  it  surprise  you  to  hear  that  Colonel 
North  gave  the  same  standard  briefing  to  110  different  groups 
during  an  18-month  period? 

A    No,  not  at  all. 

Q    In  the  spring  of  1985,  did  Mr.  Channell  ask  you  on 
two  separate  occasions  why  he  could  not  do  more  to  help  the 
Contras? 

A    Yes. 

Q    Did  it  appear  to  you  that  Mr.  Channell  had  access 
to  a  group  of  potential  contributors  and  was  seeking  foreign 
policy  issues  so  that  he  could  solicit  funds  and  retain  a 
percentage  of  the  donation? 

A    I  wouldn't  characterize  it  that  way.   He  was  very 
much  interested  in  addressing  the  key  foreign  policy  issues 


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of  the  Reagan  Adjninistration  and  he  had  settled  on  Nicaragua, 

r 
terrorism,  and  the  SDI  program,  and  like  any  non-profit,  he 

keeps  an  administrative  overhead.   It's  a  part  of  his 

operation;  it's  characteristic  of  a  non4profit. 

Q     My  question  is  whether  Mr.  Channell  was  attracted 
to  the  issues  and  then  went  out  and  sought  contributors  or 
did  he  have  contributors  and  look  for  an  issue  with  which  to 
seek  donations? 

A    Oh,  I  think  it  was  clear  to  me  after  the  meeting  in 
the  winter  at  the  time  of  the  Nicaraguan  refugee  fund  dinner 
that  he  had  a  large  number  of  very  wealthy  contributors  who 
had  a  great  deal  of  confidence  in  him,  and  that  it  was  a 
matter  of  him  best  choosing  the  issue  to  which  they  would 
then  apply  their  resources. 

Q    Did  Colonel  North  ask  you  to  discourage  Mr. 
Channell 's  efforts  during  this  time  because  Colonel  North 
could  not  envision  Mr. Channell  in  that  role? 

A    In  fact,  I  asked  him  at  least  twice  and  was 
declined  twice  for  Mr.  Channell  to  raise  money  directly  for 
the  resistance. 

Q    And  you  passed  this  information  along  to  Mr. 
Channell? 

A    Well,  yes,  but  I  think  I  did  it  pretty  diplomatical- 
ly and  I'm  not  sure  I  directly  referenced  Colonel  North,  but 
I  discouraged  him  from  doing  it. 

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Q    Did  Mr.  Channell  proceed  to  invite  Adolf o  Calero  to 
speak  at  a  fund-raising  dinner? 

A     Yes  . 

Q    Did  Mr.  Channell  and  Adolf o  Calero  discuss  the 
purchase  of  a  particular  type  of  airplane  around  this  time 
period? 

A-    Yes- 

Q    Did  Mr.  Channell  inform  you  of  his  conversations 
with  Adolf,o  Calero? 

A    Yes . 

Q    Did  you  inform  Colonel  North  about  the  conversations 
between  Mr.  Channell  and  Adolfo  Calero? 

A    Yes . 

Q    Was  Colonel  North  upset  because  the  plane  being 
discussed  had  no  ability  to  perfoirm  the  functions  for  which 
it  was  intended? 

A    Yes. 

Q    Did  Colonel  North  give  you  a  peunphlet  describing  a 
maul  airplane? 

A    Yes. 

Q    Did  you  give  this  pamphlet  to  Mr.  Channell? 

A    I  don't  recall  giving  him  the  pamphlet,  but  I 
recall  giving  him  the  specifications  of  the  aircraft. 

Q    To  your  knowledge,  is  this  Colonel  North's  first 
involvement  in  fund-raising  activities  by  Mr.  Channell 's 


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organizations? 

A  .   Yes. 

MR.  PRECUP:   Do  you  want  to  just  go  off  the  record 
while  he's  out? 

MR.  BUCK:   Sure. 

(Pause. ) 

MR.  BUCK:   Go  back  on  the  record. 

BY  MR.  BUCK: 

Q    .Mr.  Miller,  do  you  know  of  any  specific  cases  in 
which  Colonel  North  was  present  when  solicitations  were  made 
for  contributions  for  the  Nicaraguan  resistance? 

A  He  was  present  when  solicitations  were  made.  I'm 
not  entirely  clear  whether  he  left  before  the  actual  dollar 
amount  was  discussed  with  the  contributor. 

Q    Was  it  his  general  practice  to  leave  before 
solicitations  were  made? 

A    Yes. 

Q    Was  Colonel  North  aware  of  Mr.  Channell  using  NEPL 
to  solicit  money  for  the  Nicaraguan  resistance? 

A    Again,  specifically,  I  don't  think — I  don't  recall 
a  specific  conversation  between  myself  and  Colonel  North  that 
would  have  indicated  that  he  was  specifically  aware,  but  I 
think  generally  he  was  aware  that  NEPL  was  the  entity 
Channell  was  using  for  fund-raising. 

Q    m  early  April  1985,  did  you,  Frank  Gomez,  Mr. 


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Channell  and  Mr-  Conrad  meet  with  John  Ramsey? 
A    Yes--when  did  you  say? 

tsb'  -S^^SBc^-   ---   ^aS»-       ^   —  *~  ' 

Q    Was  the  purpose  of  the  dinner  to  solicit  funds  from 
Mr.  Ramsey  to  support  Adolfo  Calero  and  the  Nicaraguan 
Development  Council? 

A    That's  correct. 

Q    Did  ycu  inform  Colonel  North  that  you  would  be 
meeting  Mr.  Ramsey  to  solicit  funds  for  Mr.  Calero? 

A    I  don't  remember  whether  I  told  him  or  not. 

Q    Do  you  have  knowledge  whether  Colonel  North  know 
that  Mr.  Ramsey  would  be  soliciting  funds  for  Mr.  Calero? 

A    I  don't  remember  specifically. 

Q    Did  you  brief  Mr.  Ramsey  o%n  the  type  of  weapons 
that  the  resistance  were  using  and  how  the  resistance  was 
supplying  themselves? 

A    In  general  terms,  yes. 

Q    Who  raised  the  subject  of  weapons  at  the  Ramsey 
meeting? 

A    Gee,  I  don't  recall  specifically  who  did. 

Q    Do  you  recall  how  the  subject  was  raised? 

A    I  remember  that  Ramsey  was  interested  in  a  shotgun 
drive  and  we  told  him  that  was  not  legal. 

MR.  MC  GOUGH:   I'm  sorry.   Not  lethal  or  not  legal? 


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THE  WITNESS:   Legal.   It  was  not  legal,  and  I  think 
we  then  got  into  a  discussion  of  the  types  of  arms  they  were 
using . 

BY  MR.  BUCK: 

Q    So  you  believe  Mr.  Ramsey  raised  the  subject  first? 

A    That's  my  recollection,  but,  of  course,  we  have  the 
transcript  and  we  can  look  at  that.   You  have  it  here. 

Q    Did  you  introduce  Colonel  North  to  Mr.  Channell  at 
a  briefing,  on  June  27th,  1985? 

A    I  believe  so,  yes. 

Q    Was  it  your  understanding  that  that  was  the  first 
time  they  met? 

A    Yes. 

Q     Is  it  fair  to  say  that  weapons  were  being  discussed 
in  conjunction  with  raising  money  for  the  Nicaraguan  resis- 
tance before  you  introduced  Colonel  North  to  Mr.  Channell? 

A    I'm  sorry.   Could  you  ask  the  question  again? 

Q    Is  it  fair  to  say  that  weapons  were  being  discussed 
in  conjunction  with  raising  money  for  the  Nicaraguan  resis- 
tance before  you  introduced  Colonel  North  to  Mr.  Channell? 

A    Discussed  by  whom? 

Q    Discussed  by  yourself  and  Mr.  Channell  with  Mr. 
Ramsey. 

A    Again,  in  general  terms,  yes. 

Q    Previously  in  your  deposition,  you  discussed  a 


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$10,000  contribution  by  John  Ramsey  in  June  of  1985? 

A    Well,  there  was  a  contribution.   I  think  it's  about 
$10,000. 

Q    Okay- 

A     It  may  have  been  20,  but  I'm  not  clear  on  the 
ultimate  amount. 

Q    I  believe  you  also  testified  that  in  early  June 
1985  you  received  a  call  from  Colonel  North.   Did  he  say  the 
resistance  needed  $30,000? 

A    Yes. 

Q    Did  Colonel  North  say  the  resistance  needed  this 
money  because  they  were  ill-fed,  ill-equipped,  ill-clothed  or 
lacked  medicine? 

A    I  don't  recall  the  specific  need  other  than 
recalling  that  it  was  not  for  weapons.   I  think  it  was  either 
for  political  affairs  or  humanitarian  assistance,  but  it  was 
a  desperate  need,  nonetheless,  whatever  it  was. 

Q    To  your  knowledge,  did  Mr.  Ramsey's  money  ever  pass 
through  a  tax-exempt  corporation? 

A    No. 

Q    During  your  conversations  with  Colonel  North  around 
this  time  period,  did  you  ever  discuss  the  legality  of 
Colonel  North  requesting  that  you  raise  money  for  the 
resistance? 

A    No — well,  I  don't  specifically  recall  a  conversation 


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about    it. 

Q   -  On  or  about  July  9th,  1985,  did  you  participate  in 
a  meeting  at  the  Hay  Adams  Hotel  with  Mr.  Channell,  Mr. 
Conrad  and  Colonel  North? 

A    Yes. 

Q    Was  there  a  general  understanding  between  the  four 
participants  in  the  July  9th,  1985  meeting  that  the  money  to 
be  raised  by  Channell  would  be  used  for  humanitarian  assis- 
tance? 

A    I  think  the  only  supposition  at  that  time  was  that 
it  would  be  used  for  the  support  of  the  resistance.   General- 
ly, during  that  period  we  were  raising  money  for  humanitarian 
purposes.   That  was  the  focus  of  everybody,  not  just  Channell, 
involved  in  trying  to  secure  funds  for  the  resistance. 

Q    Do  you  know  if  Colonel  North  was  aware  of  the 
dinner  in  April  in  which  weapons  were  being  discussed? 

A    Again,  I  don't  specifically  remember  a  conversation 
discussing  it  with  him. 

Q    Did  Mr.  Channell  request  the  July  9th,  1985  meeting 
at  the  Hay  Adams  to  ensure  that  money  his  organizations  were 
raising  was  going  to  the  correct  place? 

A    Yes. 

Q    Did  Mr.  Channell  express  a  concern  at  that  meeting 
that  the  money  he  raised  for  a  particular  purpose  be  spent  on 


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A    He  raised  the  general  purpose  of  the  meeting,  which 
was  to  assure  that  it  was  going  to  the  benefit  of  the 
resistance . 

Q    Okay,  but  was  he  more  specific  than  that? 

A    Not  to  my  recollection. 

Q    Did  anyone  at  this  meeting  discuss  the  organizations 
Mr.  Channell  used  to  raise  these  funds? 

A    I  don't  recall  a  specific  conversation  on  that.   It 
may  have  t^ken  place,  but  I  don't  recall  it. 

Q    Did  Mr-  Channell  ever  seek  control  over  the  use  of 
money  after  he  transferred  the  money  to  your  organizations? 

A    No. 

Q    Did  you  ever  seek  control  over  the  use  of  money 
after  you  transferred  the  money  to  Lake  Resources  or  after 
you  transferred  money  anywhere  else? 

A    No. 

Q    Did  you  form  IC,  Inc.  so  you  could  have  a  Cayman 
Islands  bank  account? 

A    Yes. 

Q    Did  IC,  Inc.  have  two  Cayman  Islands  bank  accounts, 
an  interest-bearing  account  and  a  holding  account? 

A    Ultimately,  yes. 

Q    Was  the  main  purpose  of  IC,  Inc.  to  keep  money  out 
of  the  U.S.  so  it  would  not  have  to _be^ taxed? 

A     No 


BfiWSSi 


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ilASSIFIED 


69 


What  was  the  main  purpose  of  IC,  Inc.? 
Originally,  it  was  set  up  to  handle 


into  the  United  States  first.   It  was  foreign  money  going  to   i 
a  foreign  beneficiary,  and  so  IC,  Inc.  was  established  for 
that  purpose  initially. 

Q    Was  it  ever  the  purpose  of  IC,  Inc.  to  keep  money 
out  of  the  U.S.  so  it  would  not  have  to  be  taxed? 

A    No. 

Q    Okay.   Did  you  pay  an  annual  fee  to  a  company  to 
oversee  the  management  of  IC,  Inc.? 

A    Yes . 

Q    Were  you  the  sole  shareholder  of  IC,  Inc.? 

A    No. 

Q    Who  else  was  a  shareholder  in  IC,  Inc.?  | 

A    Francis  D.  Gomez  and  three  fellow  directors  who  are  I 
the  managing  directors  in  the  Cayman  Islands  which  have  a 
nominal  number  of  shares. 

Q    Did  you  request  the  management  company  to  change    ! 

! 

the  name  of  IC,  Inc.  to  Intel  Cooperation  in  May  of  1986?     j 
A    I  requested  them  to  change  it  to  International      { 
Cooperation  and  they  got  as  close  as  they  could,  and  under 
the  agreements  that  you  have  with  these  people  they  can  make 
those  kinds  of  decisions  and  they  thought  Intel  was  close 


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enough.   So  that's  why  it  was  called  Intel  as  opposed  to 
International • 

Q    Was  the  purpose  of  the  name  change  so  that  you 
could  amend  the  company's  charter  to  more  accurately  reflect 
the  specific  purposes  for  which  you  formed  the  company? 

A     The  name  was  changed  at  the  same  time  I  amended  the 
charter,  and  the  reason  for  amending  the  charter  was  to  make 
the  company--the  reason  for  amending  the  charter  is  that  the 
Cayman  Island  charters  are  so  broad,  they're  not  specific 
enough  that  somebody  reading  them  would  know  what  a  corpora- 
tion does,  and  I  wanted  people  to  be  very  clear  about  what 
the  corporation  did  as  its  primary  function  and  therefore  I 
amended  the  charter. 

Q    Who  are  the  shareholders  of  Intel  Cooperation? 

A    Myself,  Francis  D.  Gomez,  and  I'm  sorry  I  can't 
remember  who  the  other  three  are,  but  they  are  nominal 
shareholders  who  make  up  the  directors,  managing  directors  in 
the  Cayman — . 

Q    The  same  shareholders  that  were  shareholders  of  IC, 
Inc.  ? 

A    Correct.   It  was  just  a  name  change.   It  did  not 
change  the  corporate  structure. 

Q    Before  you  formed  IC,  Inc.,  did  you  consult  Colonel 
North? 

A     Yes.      I^aafl 


m.mm 


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UNCUSSiriE 


71 


Q    Was  Colonel  North  ever  a  signatory  on  either  of  the 
two  Cayman  Island,  bank  accounts? 
A    No. 

Q    Did  Colonel  North  ever  directly  contact  your 
management  company? 
A    No. 

Q    Did  Colonel  North  have  any  role  in  the  name  change 
or  charter  amendments  of  Intel  Cooperation? 
A    No. 

Q    Is  it  fair  to  say  that  Colonel  North  did  not 
exercise  any  operational  control  over  IC,  Inc.  or  Intel 
Cooperation? 

A    Operational  control,  no,  but  he  did  direct  the 
expenditures  from  the  accounts. 

Q    Okay,  but  he  asked  you  to  direct  the  expenditures, 
is  that  correct? 

A    He  directed  me  to  direct  the  expenditures . 
MR.  BUCK:   That's  all  the  questions  I  have. 
MR.  MC  GOUGH:   Can  we  take  maybe  a  five-minute 
break? 

MR.  PRECUP:   Sure. 

MR.  MC  GOUGH:   I've  got  to  take  care  of  something, 
then  we'll  come  back. 

MR.  PRECUP:   We're  off  the  record. 
[Brief  recess . ) 


yNCLASSIFitO 


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iO;  C  Sum.  N  E  2  5 

Vuhintion.  O  C      20002 
1 2011  M6'6«6« 


UNCLASSIFIED 


MR.  MC  GOUGH:   Let's  go  on  the  record. 
EXAMINATION  BY  COUNSEL  FOR  THE  SENATE  SELECT  COMMITTEE 

BY  MR.  MC  GOUGH:  i 

Q     Mr.  Miller,  there  are  a  few  questions  that  are 

follow-ups  on  some  of  the  topics  we  talked  about  in  the  first  : 

i 
period  and  then  there  are  some  questions  that  follow  up  on     , 

some  of  the  questions  that  Mr.  Buck  asked.   There  are  always 

follow-ups  to  follow-ups  to  follow-ups.  j 

Just  so  the  record  is  clear,  does  any  of  the  j 

testimony  today  change  in  any  way  any  of  the  answers  you  gave  i 

during  your  first  deposition?  | 

MR.  PRECUP:   Wait  a  minute.   I  have  to  object  to 

I 
that  question.   It's  just  putting  the  witness  at  great        I 

disadvantage.   He  testified  for  two  hours  before  and  the  ' 

general  question,  do  any  of  these  answers  change  anything  he   j 

had  to  say  before,  depends  upon  reading  the  transcript.  . 

MR.  MC  GOUGH:   Has  he  had  a  chance  to  read  the  | 

transcript?  I 

MR.  PRECUP:   He  has  read  the  transcript,  indeed  he 
has,  but  he  hasn't  parsed  one  against  the  other. 

BY  MR.  MC  GOUGH:  | 

Q    Well,  maybe  the  way  to  put  it  is,  to  your  knowledge,] 

as  we  sit  here  today  is  there  anything  in  that  transcript  i 

that's  inaccurate?  i 


MR.  PRECUP:   That's  a  fair  question. 


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'J?. 


THE  WITNESS:   To  my  knowledge,  no. 
BY  MR.  MC  GOUGH: 
Q    Between  the  time  of  the  last  deposition  and  this 
deposition,  have  you  met  with  anyone  from  either  the  House  or 
the  Senate  Committee--you  personally  met  with  anyone  from 
either  the  House  or  the  Senate  Committee? 
A     No. 

Q    And  between  the  times  of  those  two  depositions, 
were  you  told  with  any  specificity  what  the  questions  were 
going  to  be  today? 
A    No. 

Q     Mr.  Miller,  on  or  about  May  6th,  1987,  did  you 
enter  a  plea  of  guilty  to  a  one-count  information  in  '.'ni  i-p,j 
States  District  Court? 
A    Yes. 

MR.  MC  GOUGH:   Let's  mark  it,  if  we  could,  as  a 
deposition  exhibit. 

[Whereupon,  the  document  was 
marked  as  Miller  Deposition 
Exhibit  No.  5  for  identifica- 
tion. ] 
BY  MR.  MC  GOUGH: 
Q    Take  a  look,  if  you  would,  at  what  has  been  marked 
as  Deposition  Exhibit  5-   Is  that,  in  fact,  the  information 
to  which  you  entered  a  plea  of  guilty? 

immnooinrn 


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A  Yes. 

Q    And  at  the  time  you  entered  that  plea  of  guilty, 
did  you  name  in  open  court  Colonel  Oliver  North  as  a  co- 
conspirator? 
A     No. 

Q    Did  you  identify  any  co-conspirator  in  court? 
A    No--I'm  trying  to  remember. 

[Witness  conferring  with  counsel.] 
THE  WITNESS:   Well,  that's  a  different  question. 
MR.  MC  GOUGH:   What  is  a — . 

MR.  PRECUP:   Would  you  like  to  go  off  the  record? 
MR.  MC  GOUGH:   Yes,  let's  go  off  the  record. 
[Discussion  off  the  record.] 
MR.  MC  GOUGH:   Let's  go  back  on  the  record. 
I  think  there  was  a  question  and  the  answer  to  the 
question  was  no.   Did  he  name  Colonel  North  as  a  co-con- 
spirator, and  at  that  point  we  went  off  the  record.   If  there 
was  an  outstanding  question  prior  to  going  off  the  record, 
I'll  withdraw  it. 

Let's  have  this  marked  as  Exhibit  6,  if  we  could. 
[Whereupon,  the  document  was 
marked  as  Miller  Deposition 
Exhibit  No.  6  for  identifica- 
tion. ) 


BY    MR.     MC    GOUGH: 


lilLMfiED 


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Q    Mr.  Miller,  do  you  recognize  Exhibit  6? 

A    Yes. 

Q    And  are  they  your  notes  in  your  handwriting? 

A    Yes. 

Q    And  the  date  at  the  top,  I  believe,  is  September 
18th,  1985,  is  that  correct? 

A    Correct. 

Q    And  were  these  notes  written  on  or  about  September 
18th,  1985? 

A    Yes. 

Q    Now,  the  numbers  7,  8  and  9  appear  to  be  in  a 
slightly  different  script  or  pen  than  the  numbers  above  it. 
To  the  best  of  your  recollection,  were  the  numbers  7,  8  and  9 
written  at  the  same  time  as  the  numbers  1  through  6? 

A    No. 

Q    Were  they  written  on  the  same  day,  if  you  know? 

A    I  don't  remember  exactly. 

Q    Was  it  your  practice  on  occasion  to  list  numbers 
consecutively  even  though  they  did  not  take  place  in  the  same 
conversation? 

A    Yes. 

Q    Concentrating  for  a  moment  on  numbers  7  and  8-- 
$415,000-Weapons,  C4,  M79;  and  number  8,  $520,000,  maul--to 
the  best  of  your  recollection,  what  was  the  source  of  those 


notes? 


ilL&SSlEIEIL 


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S!F!E! 


A    Colonel  North  and  I  had  a  discussion  about  finding 
what  Mr.  Channell  called  big-ticket  items  for  contributoL-p , 
and  those  were  two  of  the  items  which  we  discussed.   I  don't 
remember  a  great  deal  of  discussion  on  number  7.   I  have  a 
fairly  specific  remembrance  on  number  8. 

Q    Now,  S<il5,000 — was  that  an  amount  given  to  you  by 
Colonel  North? 

A    I  believe  so. 

Q    And  the  $520,000  was  also  an  amount  given  to  you  by 
Colonel  North? 

A    That,  I'm  sure  of. 

Q    And  at  the  time  you  were  discussing  these  big- 
ticket  items,  did  you  inform  Colonel  North  that  these  would 
be  used  to  solicit  money  from  contributors? 

A    Yes . 

Q    There  were  times,  where  there  not,  when  you  asked 
Colonel  North  to  draft  thank  you  letters,  and  specifically 
thank  you  letters  to  Mr.  Channell  and  his  organizations?   Is 
that  fair  to  say? 

A    Yes. 

Q    And  aunong  those  thank  you  letters  were  thank  you 
letters  written  commending  the  National  Endowment  for  the 
Preservation  of  Liberty  and  its  efforts  on  behalf  of  the 
Nicaraguan  cause,  is  that  correct? 

A       .   Cause,    yes. 


yilASSIFI 


79 


iSSlFIED 


Q    At  the  briefings  conducted  at  the  white  House  in 
which  Colonel  North  participated--those  are  the  briefings 


■um  mmmma  eo..  we. 

M7  C  Sotn.  N  E  25 

«adui|i0B.  0  C     20001 


3  I  sponsored  by  Mr-  Channell--there  was  information  distributed, 

4  j  was  there  not,  on  the  National  Endowment  for  the  Preservation 

5  j  of  Liberty? 

6  A    At  the  white  House  briefings  given  by  Colonel 

7  I  North?   I  don't  recall  any. 

8  Q    Were  there  packets  of  information  put  together  that  j 

9  were  distributed  at  dinners  or  meetings  after  the  briefings?   j 

10  A    Yes.  ] 

11  Q    To  your  knowledge,  did  Colonel  North  ever  attend 

12  any  of  those  dinners  or  meetings? 

13  A    I  know  he  attended  one  at  the  Hay  Adams.   I  think 

14  he  attended  one  at  the  Hay  Adams. 

15  Q    To  your  knowledge  or  to  your  recollection,  did 

16  Colonel  North  ever  see  any  of  the  material  or  descriptive 

17  material  on  the  National  Endowment  for  the  Preservation  of 

18  Liberty? 

19  A    Probably,  yes. 

20  Q    There  were  occasions,  were  there  not,  Mr.  Miller, 

21  where  Colonel  North  assisted  you  and  Mr.  Channell  in  obtaining 

22  White  House  support  for  Mr.  Channell's  fund-raising  efforts, 

23  and  by  that  I  mean  either  thank  you  letters  from  the  President 

24  to  contributors  or  use  of  White  House  facilities  or  even 
meetings  between  Mr.  Channell's  contributors  and  the  Presi- 


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icuissinEO 


dent?   Is  that  fair  to  say? 

There  were  times  when  Colonel  North  assisted  you 
and  Mr.  Channell  in  those  efforts  in  obtaining  that  support 
from  the  white  House? 

A    Could  you  take  them  one  at  a  time? 

Q    Sure. 

A  I  mean,  you've  thrown  out  a  whole  bunch  of  ques- 
tions . 

Q    pkay,  I  know  I've  thrown  out  a  whole  bunch.   Let's 
take  the  Presidential  drop-by  at  the  January  1986  meeting. 
To  your  knowledge,  did  Colonel  North  assist  you  and  Mr. 
Channell  in  obtaining  a  Presidential  drop-by  for  the  January 
1986  briefing? 

A  The  answer  to  your  question  is  no,  specifically. 
In  general  terms,  as  I  understand  the  way  the  briefing  was 
arranged,  it  was  arranged  by  the  Office  of  Public  Liaison, 
who  I  went  to  in  order  initially  to  set  up  the  briefing. 

We  requested  that  the  national  security  briefing  be 
given  by  Colonel  North  and  that  in  whatever  the  flow  of  paper 
was  at  the  White  House  that  was  agreed  to.   So  we  requested 
specifically  when  I  went  to  see  Linda  Chavez  that  Colonel 
North  would  be  the  national  security  person  giving  the 
briefing. 

Q    And  in  order  to  obtain  Colonel  North's  support  or 
his  attendance  at  the  briefing,  there  were — I  think  you  said 


>^Rr^!OMftnirirn 


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UNCLASSIFIED 


there  was  paper  flow  at  the  White  House.   Is  that  fair  to  say  .. 
that  there  were  memos  to  be  written  and  approvals  to  be  givon? 

A     I'm  making  an  assumption  that  that's  the  case. 

Q  Do  you  ever  recall  drafting  memoranda  that  described' 
the  National  Endowment  for  the  Preservation  of  Liberty  or  any  ; 
of  its  contributors  for  submission  to  the  White  House? 

A  I've  forgotten  the  exact  date,  but  in  the  instance  ; 
of  Barbara  Newington,  we--myself,  I  drafted  or  provided  some 
material  for  the  drafting  of  a  memorandum  which  I  believe  • 
originated  in  the  State  Department  in  the  Office  of  Public  i 
Liaison  to  Robert  McFarlan^ suggesting  that  Mrs.  Newington  be  : 
given  an  appointment  with  the  President. 

Q    And  in  that  memorandum  do  you  recall  whether  you 
made  any  mention  of  or  described  the  National  Endowment  for    r 
the  Preservation  of  Liberty?  j 

A    I  believe  I  did,  yes,  because  some  of  the  programs   | 

! 

she  had  contributed  to  were  National  Endowment  public 
education  programs. 

Q    Do  you  recall  whether  in  these  memoranda  you 
referred  to  the  National  Endowment  for  the  Preservation  of 
Liberty  as  a  non4profit  organization? 

A     I  don't  specifically  recall,  but  you  have  a  copy  of 
the  memorandum. 

Q    Other  than  Mrs.  Newington 's  case,  can  you  recall 
drafting  for  the  white  House's  consideration  any  memoranda 


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80 


about  the  National  Endowment  for  the  Preservation  of  Liberty: 
A    I  don't  recall  drafting  any  memoranda.   I  think  we 
offered  potential  talking  points  for  a  couple  of  the  brief- 
ings.  I  don't  think  they  were  used,  though. 

Q    Those  talking  points,  would  they  have  referred 
specifically  to  NEPL  or  would  they  have  been  more  generally 
on  the  Nicaraguan  situation? 

A    I  think  they  would  have  been  on  NEPL. 


And  would  they  have  included  the  fact  that  NEPL  was 


9 


a  non-profit  organization? 

A    Again,  T'm  not  specifically  sure,  but,  again,  you 
have  copies  of  them.   I  don't  recall  specifically. 

Q    Colonel  North  had  direct  contact  with  Mr.  Channell 
and  Mr.  Conrad  at  times  when  you  were  not  present,  is  that 
correct? 

A    Correct. 

Q    And  there  came  a  time,  did  there  not,  when  Mr. 
Conrad  began  to  bypass  IBC  in  contacting  Colonel  North  for 
assistance  or  information? 

A    I  believe  that's  true.   I  know  it  was  at  least 
being  attempted  at  one  point  and  I  had  a  specific  conversation 
with  Fawn  Hall  about  it,  and  my  general  feeling  was  that  that 
had  begun  to  take  place,  yes. 

Q     You  mentioned  that  Colonel  North  rebuffed  two 
attempts  on  behalf  of  Mr.  Channell  to  raise  direct  support 


83 


9 

A 

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Q 

17 

18 

Tower  C 

19 

Report 

20 

21 

A 

22 

Q 

23 

A 

24 

Q 

HtXI*  RtPOnTINa  CO  .  INC. 
507  C  Scrett,  N  E                2  5 

A 

Wuhtngton.  D  C      20002 

yjj^46.*"' 

for  the  Nicaraguan  cause,  is  that  right? 
A    Correct. 

Q  Do  you  recall  what  you  told  Colonel  North  about  Mr. 
Channell  and/or  his  organizations  at  the  time  you  made  those 
proposals  to  him? 

A    Not  specifically,  no. 

Q    Do  you  recall  whether  you  told  him  that  they  were 
non-^-profit  organizations? 

Again,  I  don't  specifically  recall  the  conversation. 
MR.  MC  GOUGH:   Let's  have  this  marked  as  Exhibit  7. 
[Whereupon,  the  document  was 
marked  as  Miller  Deposition 
Exhibit  No.  7  for  identi  t:  i'-,T- 
tion. ] 
BY  MR.  MC  GOUGH: 

Mr.  Miller,  take  a  look  at  Exhibit  7,  if  you  will. 
For  the  record,  this  is  copied  directly  out  of  the 
Tower  Commission  Report,  a  page  in  the  Tower  Commission 

Have  you  ever  seen  a  chart  like  this  before? 

Yes. 

Where? 

In  Colonel  North's  office. 

And  can  you  put  any  kind  of  time  frame  on  it? 

The  only  thing  I  can  recall  is  that  it  was  his  old 


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muK  Roomwo  co..  mc 

W  C  Sam.  N.E.  2  5 

Vuhuifioa.  0  C     20002 


ONCLASSIFIEO 


82 


office,  not  the  one  that  he  was  in  at  the  time  he  was  fired. 

Q   .  All  right,  and  can  you  just  briefly  tell  us  how 
this  came  to  your  attention? 

A    I  went  to  see  Colonel  North  because  I  had  heard 
that  there  was  going  to  be  a  public  affairs  effort  in  order 
to  support  the  Afghan  resistance  and  I  was  interested  in 
finding  out  wp$  I  went  to  try  and  get  some  business  in  that 
regard . 

i^nd  I  talked  to  him  about  that  and  his  response 
was,  okay,  well,  let  me  show  you  how  a  covert  operation  is 
set  up,  and  he  asked  Bob  Earl,  as  I  recall,  to  get  some  kind 
of  a  piece  of  paper  and  Earl  came  back  in  with  this,  only  it 
was  on  a  yellow  pad. 

And  North  put  it  down  in  front  of  me  and  said,  let 
me  show  you  how  a  covert  operation  is  set  up.   And  with  that, 
as  I  recall,  the  secure  line  went  off  in  his  office  and  he 
had  to  take  a  phone  call  and  I  got  to  stare  at  this  thing  for 
a  few  minutes  and  then  I  had  to  leave. 

Q    Now,  to  the  best  of  your  recollection,  was  the 
chart  that  you  saw  identical  to  or  only  similar  to  what  we've 
marked  as  Exhibit  7? 

A    Similar  to. 

Q    And  in  what  respects,  if  you  can  recall,  was  it 
different? 

A    I  don't  remember  the  number  of  boxes,  and  I 

Maim  urinirirn 


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■tXER  HOOflTINQ  CO..  INC 

W7  C  SuCTt   N  E  2  5 

Washui|ion.  0  C      Z0002 


specifically  don't  remember  this  clutter  over  on  the  southeas- 
tern quadrant . 

Q  All  right.  Now,  let's  go  from  the  southeastern 
quadrant  to  the  northwestern  quadrant  and,  in  particular, 
three  entries  there,  NEPL,  ACT  and  IBC,  under  the  heading 
■U.S.  ■ 

Do  yov   recall  which,  if  any,  of  those  boxes  was  on 
the  chart  that  you  saw? 


A    I  think  they  were  both  on. 

Q    I  think  I  named  three,  NEPL,  ACT  and  IBC. 

A     I  think  all — . 

Q    All  three? 

A     I  think  I  remember  all  three  being  there. 

Q    You  said  that  the  name  of  IC,  Inc.  was  changed  to 
Intel  Cooperation,  and  that  was  done  to  bring  it--and  at  the 
same  time  the  charter  was  changed  to  be  more  descriptive 
about  what  the  company  was  doing? 

A    Correct. 

Q    What  was  added  to  or  modified  in  the  charter  at  the 
time  the  name  was  changed? 

A    I  can  try  and  do  it  from  memory.   I  think  you  have 
a  copy  of  the  charter.   It  was  to  make  the  number  one  charter 
item  the  distribution  of  benevolent  contributions  to  politi- 
cal, benevolent  and  humanitarian--I 'm  not  sure  the  word 
"humanitarian"  was  used--organizations . 


i%Mm  sfkf^in^rit 


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HUIII  DErOKTmO  CO..  MC. 
J07  C  Sci«l.  N  E  2  5 

Vuhiniion.  D  C     20002 
(2021  M6.6666 


mmmn 


84 


Q~      Did   the  charter  make   any;  reference^ to  military 

#:      '     .  ^  ^        "  - 

organizations?  _^  ^^^      ..;£^._.^_-; 

A  Not   that    I   sgpcif icallj^fecall,    rro.  j_^ 

Q  Just    as    you   recall,    political,  l^nevolent   and 

educational   organizationsij^as   y6a"call   it? 

A  That  probably   is    accurate^^but   again    I'm   doing    it 

from  memory.      I   don' t^J5^ca^^i.t.-j^eclf icallyr^jjtalt    I    rernenber 
political   entities  was   one  «f   the  words  that  was   tfaed. 

Q  And  which  of    those  wit^^es   would   hav«   been   Lake 

Resources?    .What   kind  of   entityfewS^' LakawResources^  " 

A         At   the   time,    I^pcm^^^Si  cOJHiiderea — at   the   time   I 
did   that  CliaLrter -chang^^  I^^ould  t|^Ei[^on&ider<&d  that   to   have 
been   an  organization   in  support_of   the  resistance,    ^t^t   of 
the   resistance.  -  "    .^.  .#• 


Q         I- 

It's   kind  qg'an  wrfair  qtrestiont^TomT '   If  you  TOuld  ^how  hi» 
the  charter  page,    i^  you  have  it  wiAfe  7°^ — w»dflwi-'t  have  it 
with-us — then.  <*»;^\>^fa|»JL^^t^jna^gg!a:3f ^jdi^rfgg-an  i  z  a  t  ion , 
perhaps-,   tc^one^^the  'T"''^^*'^^^^—*"'^     rST''^!'  ^ 

■^  :~-~'  ^R^*» 'tr^ng'^^  "do-_^a^^rom  jb^»o^' is^  it  Lg.  legal 
lanfaa^e.  ~Mr.  Hillee^  no^it'l^^pr^  It  is  aT  bit  unfair  to 
him,    I    think. 

BY    KR.    MC    GOUGH: 


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MunNooimM  CO. 

MC. 

507  C  Sotti 

NE, 

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Vuhuiftotl. 

DC 

20002 

1  *~Q  Mr.    Miller,    djuiyou   suggest   tbf   language   to   be 

2  included    in   the  char^Bf  chanjf^ 

3  A  Yes. 

4  Q  And   you    did   that,    you   said,    I    believe,    to  bring    the 

5  charter   more^^taJto-lMBt  with  what    Intel   Cooperat^n  w^   being 

6  us«d.  -^r,    is    that   right? 

7  F;       -    A  Correct .      _ 
Q          And   one  o^the   things    Inbe^l   Cooperation T»as   doing 

was  .passing  along  sums  of  money  to  IiS^e  Sea^urcesr^  is  _that 

correct?  -    -5  1       ^.  =ji-..-~i;^  -^ 

A         Corr^t^  -^S.   ^' ,      "^  -r^        ~^ " 

Q  And  Laka   RM^rces,  _J    think  you've- dessxibed   as   an 

account--at   that^time,    yOu  balieved^it- was   aff  «ccount   somehow 

associated  wi^t  what  you'v«  called  titc  resistance,    is   that 
1^5j^corr« 

f^      ^roJ^fcBj^i.^^jgJP'J^ —7*  Sb  chagtttefto  E^IfigT^i tTf i n 
its   ambit   an  orgariTialiort  asTOciated  with  the   resistance? 

-A  I   w^pid^have  con^dered   the   resistance   a   political 

-^Ri^MC  GOUGffr    I   think  that's   all    I    have.  __ 

-'MR^JRYHMtef  Z 'ft439  ^°  questions   at   this    time.      As 
I    indicated  be fiure  ~^  .j^nan ,    l^s^^^P^hit.  this-tlaposition 
will   continue   at   another  elate  ,#nd   I  will   hjjte   further 
questions    at   that^ime. 


88 


HIXDt  NVlMIINa  CO..  MC. 
i07  C  Stre«i.  N  E 

('All  M6.6664 


liNClASSIFIED 


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MR.  BUCK:   I  have  no  more  questions. 
[Whereupon,  at  10:25,  the  taking  of  the  deposition 
was  concluded.] 


fc 


89 


mXt»  HVOKTINa  CO.,  MC 

vn  C  Sum.  N  E. 

WtihiniTon.  D  C      20002 


WSSiFltD 


CERTIFICATE  OF  REPORTER 
I  hereby  certify  as  the  stenographic  reporter  that 
the  foregoing  proceedings  were  taken  stenographically  by  me 
and  thereafter  reduced  to  typewriting  by  me .   I  further 
certify  that  it  is  a  true  and  accurate  record  to  the  best  of 
my  ability. 


/AJnu. 


Victoria  A.    Ranucci 


iNf:USS!F!EO 


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■utH  Mponma  CO..  mc 
W7CSa<«.  NE 
Wahiiifioo.  DC.    20001 
1102)  VM-iM« 


yMf! 


SIRE 


88 


CERTIFICATE  OF  NOTARY  PUBLIC 


I,  PAMELA  BRIGGLE,  the  officer  before  whom  the 
foregoing  deposition  was  taken,  do  hereby  certify  that  the 
witness  whose  testimony  appears  in  the  foregoing  deposition 
was  duly  sworn  by  me;  that  the  testimony  of  said  witness  was 
taken  by  me  and  thereafter  reduced  to  typewriting  by  me  or 
under  my  direction;  that  said  deposition  is  a  true  record  of 
the  testimony  given  by  the  witness;  that  I  am  neither  counsel 
for,  related  to,  nor  employed  by  any  of  the  parties  to  the 
action  in  which  this  de[>osition  was  taken;  and  further,  that 
I  am  not  a  relative  or  employee  of  any  attorney  or  counsel 
employed  by  the  parties  hereto,  nor  financially  or  otherwise 
interested  in  the  outcome  of  the  action. 


PAMELA  BRIGGLE 


Notary  Public  in  and  for  *-he 
District  of  Columbia 


My  Commission  expires  May  14,  1990. 


um 


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UNCLASSm 


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SELECT  COMMITTEE  TO  INVESTIGATE  COVERT 

ARMS  TRANSACTIONS  WITH  IRAN 

U.S.  HOUSE  OF  REPRESENTATIVES 

AND 

SELECT  COMMITTEE  ON  SECRET  MILITARY  ASSISTANCE 

TO  IRAN  AND  THE  NICARAGUAN  OPPOSITION 

UNITED  STATES  SENATE 


Thursday,  August  20,  1987 

Washington,  D.C. 

Deposition  of  RICHARD  RODERICK  MILLER  taken  on 

behalf  of  the  Select  Committees  above  cited,  pursuant  to 

notice,  commencing  at  9il0  a.m.  in  Room  901  of  the  Hart 

Senate  Office  Building,  before  Terry  Barham,  a  notary  public 

in  and  for  the  District  of  Columbia,  when  %rere  present: 

For  the  Senate  Select  Committee: 

JAMES  E.  KAPLAN,  Esq. 
Associate  Counsel 

For  the  House  Select  Committee: 

JOHN  FRYMAN,  Esq. 
SPENCER  OLIVER,  Esq. 
RICHARD  J.  LEON,  Esq. 
For  the  deponent: 

EARL  C.  DUDLEY,  JR.,  Esq. 
Nussbaum,  Owen  &  Webster 
One  Thomas  Circle 
Washington,  D.  C.  20005 


■um  NVORTwa  CO.  HC. 

107  C  Simt.  N  E. 
Wuhiaiisa.  DC.    20002 
(202)M«-«M« 


UNCLA 


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art90 


UNCLASSIHED 


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CONTENTS 

Examination  by  counsel  for 

Paqe 

Senate  Select  Committee 

91 

EXHIBITS 

Exhibits 

Marked 

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(301)  V4«4M« 


UNCUSSIHED 


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PROCEEDINGS 
whereupon, 

RICHARD  RODERICK  MILLER 
assumed  the  witness  stand  and,  having  previously  been  duly 
sworn,  was  further  examined  and  further  testified  as  follows: 
EXAMINATION  BY  COUNSEL  FOR 
SENATE  SELECT  COMMITTEE 
BY  MR.  KAPLAN: 
Q    Good  morning,  Mr.  Miller. 
A    Good  morning. 

Q    As  you  know,  my  name  is  James  Kaplan,  and  I'm 
Associate  Counsel  with  the  Senate  Select  Committee.   This 
deposition  is  a  continuation  of  prior  depositions  which  were 
taken  pursuant  to  immunity  orders  of  both  the  House  and 
Senate  Committees,  which  I  believe  are  marked  as  Exhibit  1 — 
that  is  the  Senate  Immunity  Order — and  Exhibit  4 — that  is  the 
House  Immunity  Order,  respectively. 

I  simply  remind  you  that  you're  still  under  oath. 
Again,  Just  for  the  record,  could  you  state  your 
full  name. 

A    Richard  Roderick  Miller. 


And  your  Social  Security  number? 

Paitially DtdmlHtd^Meaied  on  ^/^^  .J    /^^^ 


And  what  is  your  date  of  ^ijjtj 
12-22-52. 


er  provisions  of  E.0. 123S6 
b)r  D.  SMw,  NalJoiul  Security  Counci! 


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(202)  VM-MM  


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Q    Now  we've  gqne  over  your  professional  background,  I 
believe  in  tJife  pribt depositions,  except  for  a  short  period 
of  time.   Was  there  a  time  in  your  career  in  which  you  formed 
a  public  relations  firm  named  Rand  Corporation? 

A     RAM.   R-A-M. 

Q     It's  R-A-M7 

A     Right. 

Q    And  when  was  that? 

A    Actually,  it  was  not  a  corporation,  it  was  a  sole 
proprietorship,  and  it  was  1981. 

Q    Was  that  at  a  time  when  you'd  been  furloughed  from 
campaign  activities  on  behalf  of  the  Reagan  campaign? 

A    That's  a  good  choice  of  words.   I  thought  of  it 
before.   That's  exactly  what,  had  happened. 

MR.  DUDLEY:   Off  the  record  a  minute. 

MR.    KAPIiAN:      Sure. 

[Brief  discussion  off  the  record.] 

MR.  KAPLAN:   On  the  record. 

BY  MR.  KAPLAN: 

Q    Off  the  record,  in  a  short  discussion  with  your 
counsel,  was  your  recollection  refreshed  such  that  you  recall 
that  RAM  Corporation,  the  public  relations  firm  that  you 
formed,  was  actually  formed  in  1980? 

A    That's  correct.  "'..?.  :   ,  . 

Q    And  was  your  recollection  refreshed  by  the  fact 

HUM  Accicicn 


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(202)  »t-i6U 


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93 


that  you  recalled  that  that  corporation  was  formed  at  a  time 
when  you  had  been  furloughed,  temporarily,  from  campaign 
activities  on  behalf  of  the  presidential  campaign  for  Ronald 
Reagan? 

A    Correct. 

Q    Could  you  describe  your  educational  background  for 
us. 

A    My  bachelor's  degree  is  in  government  and  politics 
from  the  University  of  Maryland.   My  associate  degree  is  in 
general  studies  from  Brandywine  University.   I  also  attended 
Northeastern  University,  between  the  two  of  those,  in  Boston, 
and  one  year  prior  to  that  at  Catawba — prior  to  Brandywine, 
at  Catawba  College  in  Wilmington — or  Salisbury,  North 
Carolina. 

Q    You've  testified,  previously,  that  IBC,  or  Interna- 
tional Business  Communications  became  a  partnership  in  1986, 
between  Miller  Communications  and  Gomez  International.   Is 
that  correct? 

A    Correct , 

Q    Was  there  a  written  partnership  agreement? 

A    No.   There  was  not. 

Q    Was  there  a  joint  venture  with  any  entity  at  that 


time? 


In  July  of  1986  there  was  a  joint -venture  agreement 


signed  between  International  Business  Communications  and 

UNTI  ACCICICn 


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TutuniToii.  D  C     20002 
(202)  !46.666« 


wmma 


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David  C.  Fischer  and  Associates. 

Q    Has  there  ever  been  a  written  partnership  agreement 
between  Miller  Conununications  and  Gomez  International? 

A    No. 

Q    How  does  the  distribution  of  partnership  proceeds 
work,  as  between  Miller  Communications  and  Gomez  Internation- 
al? 

A    It  is  a  50/50  net  split. 

Q    What  is  the  joint-venture  arrangement  between  IBC 
and  David  C.  Fischer  and  Associates? 

A    It  was  to  be  a  50/50  gross  split  on  clients  that  we 
both  worked  on.   Shared  clients. 

Q    Prior  to  July  1986,  what  was  the  structure  of 
International  Business  Communications? 

A    Prior  to  July  of  '86? 

Q    Right. 

A    Well,  in  January  of  1985 — I'm  sorry — January  of 
1986,  we  began  operating  as  a  partnership.   We  didn't  form — 
we  formed  the  corporations  in  January,  I  believe. 

Q    Okay. 

A    So  we  were  operating  in  '86  as  a  partnership. 

Q    As  a  partnership.   Let's  take  the  period,  then, 
prior  to  January  1986.   What  was  the  structure  of  IBC? 

A    It  was  a  sole  proprietorship. 

Q    And  were  you  the  sole  proprietor? 


ilMPIACOnrn 


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M7CStrctt.  NE  25 

Wuhiii(ion.  D  C     20002 
(202)  ^*i-6666 


uNcussra 


95 


A  Correct. 

Q    what  was  your  relationship  with  Frank  Gomez  prior  to 
the  formation  of  the  partnership  in  January  of  '86? 

A    On  a  legal,  on  a  legal  basis,  Frank  was  a  sub- 
contractor.  In  reality,  we  were  working  towards  what  was  the 
ultimate  structure,  which  was  a  partnership. 

Q  And  had  Mr.  Gomez  been  a  subcontractor  of  IBC  since 
some  time  in  1984? 

A  Again,  he  was  on  it  for  legal  and  tax  purposes,  was 
listed  as  a  subcontractor,  but  again,  we  were  working  towards 
a  partnership  arrangement.  And  in  fact  in  '85  actually  had  a 
split  of  profits,  in  1985. 

Q    Okay.   Prior  to  the  joint-venture  arrangement  that 
was  executed  as  between  IBC  and  David  C.  Fischer  and  As- 
sociates in  July  1986,  what  was  the  relationship  between  IBC 
and  David  Fischer,  if  any? 

A    David  Fischer  was  a  subcontractor  at  the  end  of 
1985  through  the  beginning  of  1986. 

Q    Could  you  explain,  for  the  record,  what  you  mean 
when  you  categorize  someone  as  a  subcontractor  of  IBC. 

A    A  subcontractor,  as  I  understand  it,  is  somebody 
who's  not  an  employee,  and  is  not  a  participant  in  the  firm 
in  the  way  of  ownership. 

Q    Were  these  people--that  is,  Mr.  Gomez  and  Mr. 
Fischer--acting  on  some  sort  of  a  consulting  arrangement  with 


!i  m^\^i\ 


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MXei  HCTOKTMa  CO  .  wc. 
)07  C  imn.  N  E  25 

Wuhistion.  D  C     20002 
(202)  VW-«6M 


UNCUSSIFIED 


96 


IBC7 

A    Well,  again,  in  regards  to  Frank  Gomez  in  1985, 
Frank  was,  for  all  intents  and  purposes?,  a  partner7  and:  we 
accomplished  the  change  in  the  structure  in  January  of  '86. 
As  to  Fischer  and  Marty  Artiano,  they  were  both  consultants 
to  IBC.   Senior  consultants. 

Q    I'd  like  to  turn  your  attention  to  IC,  Inc.  for  a 
while.   When  was  IC,  Inc.  formed? 

A    April  1985. 

Q    And  was  IC,  Inc.  formed  at  Colonel  North's  request? 

A     Yes. 

Q    It  was.   And  without  going  into  all  of  the  ac- 
tivities involving  the  fake  Saudi  prince,  who  we'll  get  into 
in  much  more  detail  later,  c^n  you  tell  us  how  that  request 
came  about. 

A    I  was  approached  on  the  telephone  by  a  gentleman  by 
the  name  of  Kevin  Kattke,  who  told  me  that  he  had  been 
referred  by  Colonel  North,  and  that  he  had  a  very  wealthy 
client  who  wanted  to  make  a  contribution  to  the  Nicaraguan 
resistance,  and  asked  if  I  would  meet  him. 

I  called  Colonel  North  and  told  him  of  the  phone 
call,  and  he  told  me  that  he  had  sent  the  phone  call  to  me, 
and  that  I  should  go  ahead  and  meet  with  him,  which  I  did, 
and  this  person  held  himself  out  to  be  a  member  of  the  royal 
Saudi  family. 


UNCUSSIFIEO 


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HLm  modrma  co..  mc. 
)07  C  Siren.  NE  25 

Wiiiuiiron.  D  C     20002 
(202)  M6'6«6< 


UNCLASSIFIED 


97 


And  he  offered  $14  million  in  aid,  which  was  a 
rough  match  of  what  the  President  had  asked  Congress  for,  to 
the  Nicaraguan  resistance,  and  signed,  in  a  subsequent 
meeting,  a  promise  letter  for  proceeds  from  this  oil  transac- 
tion.  And  I  discussed  it  with  Colonel  North,  and  I  told  him 
that  I  thought  it  would  be  ridiculous  to  bring  14  or  $15 
million  into  the  United  States,  have  the  IRS  promptly  attach 
7.5  million  of  it,  and  then  have  Adolf o  Calero  wondering 
where  the  other  7.5  was.   And  since  it  was  money  coming  from 
Saudi  Arabia  and  going  to  Calero,  there  was  no  reason  for  it 
to  come  into  the  United  States.   And  I  suggested  that  the 
transaction  be  handled  offshore,  and  he  agreed,  and  I--either 
before  or  after — I'm  not  now  sure  of  that  conversation-- 
discussed  it  with  some  friends  who  did  foreign  banking,  and 
the  best  location  seemed  to  be  the  Cayman  Islands. 

Q    Who  discussed  that  with  friends? 

A    I  did. 

Q    That  was  you? 

A    I  did. 

Q    All  right.   Now  just  a  moment  ago,  you  said  that  it 
was  at  Colonel  North's  request  that  you  opened  this  Cayman 
Islands  account,  yet,  in  your  testimony,  you  suggested  that 
you  had  called  Colonel  North  to  tell  him  that  you  had  come  to 
a  conclusion  that  it  would  be  better  to  establish  this 
offshore  accounts,  and  I'm  just  trying  to — 


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mujoi  NVOirnNo  co..  mc. 
M7  C  Sirm.  N  E  25 

Widuaitoa.  D  C      20CO: 
(20:)  i*t-tti6 


uHCUiSsro 


98 


A    Actually,  that  conversation  was  not  on  the  tele- 
phone, it  was  in  a  meeting,  and — 

Q    But  nonetheless,  what  I'm  trying  to  clarify  for  the 
record  is  whose  idea  was  it  to  form  an  offshore  account  to 
take  these  funds  that  the  Saudi  prince  was  intending  to  give 
to  the  contrast 

A    Well,  I  can't  tell  you  exactly  whose  idea  it  was 
that  it  be  an  offshore  account.   I  can  tell  you  that  my 
purpose  in  meeting  with  North  was  to  seek  his  permission  to 
do  it  in  the  fashion  that  I've  just  described  it  to  you. 

Q    Did  you  watch  Colonel  North's  public  testimony  :- 
before  the  Committees? 

A    I  have  no  idea  what — I  haven't  watched  his  tes- 
timony, or  John  Poindexter's.. 

Q    Are  you  aware  that  Colonel  North  testified  that  the 
offshore  account  was  established  at  his  request? 
A    No .   I'm  not . 

[Brief  discussion  off  the  record.] 
MR.  KAPLAN:   Back  on  the  record. 
BY  MR.  KAPLAN: 
Q    Would  it  be  inaccurate  to  say  that  the  offshore 
account  was  established  at  Colonel  North's  request? 

A  I  don't  think  so.  I  think  that's  consistent  with 
what  I've  just  said.  I  mean,  I  was  an  agent  working  on  his 
behalf.   I  went  to  ask  his  permission  to  handle  it  the  way  it 


102 


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MunwMimra  co..  mc. 

)07CStren.  NE  25 

WuhinfToo.  O  C      20002 
(202)  VM-MM 


UNClASSra 


99 


was  being  handled,  and  the  individual  was  sent  to  me  at  his 
direction,  so-- 

Q    How  did  you  reach  the  conclusion  that  you  were  an 
agent  working  on  his  behalf? 

A    I'm  not  sure  I  really  even  understand  the  question. 

Q  Well,  you  mentioned  in  your  previous  answer,  that 

you  considered  yourself,  with  respect  to  the  dealings  with 
the  Saudi  prince,  to  be  an  agent  working  on  behalf  of  Colonel 
North. 

A    Well,  if  you're  attributing  something  to  the  word 
"agent",  then  maybe  I'll  just  choose  another  term.   I  was 
working  on  his  behalf. 

Q    Okay.   And  how  did  you  arrive  at  the  conclusion 
that  you  were  working  on  behalf  of  Colonel  North? 

A    Well,  he  had  sent  the  individual  to  me.   I  had  been 
involved  in  other  activities  with  Colonel  North,  and  it  was 
obvious  that  I  was  being  asked  to  handle  this  matter. 

Q    And  was  it  obvious  to  you  that  you  were  being  asked 
to  handle  this  matter  on  his  behalf? 

A    Yes. 

Q    what  did  he  say  to  you,  that  led  you  to  that 
belief?  Or  what  circumstances  gave  rise  to  that  belief?   If 
you  recall. 

A    First  and  foremost  was  having  the  individual  sent 
to  me  to  begin  with,  since  there  were  other  avenues  available 

iruni  icoinrh 


103 


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wun  tpmiiwu  co..  mc. 

>07CSn.«.  NE.  25 

Wuhinfnxi.  D  C.    20002 
r202)  i*6.U6t 


UNCLASSIHED 


100 


to  him. 

Q    What  other  activities  had  you  conducted  on  behalf 
of  Colonel  North,  prior  to  the  referral  of  the  Saudi  prince? 

A    We'd  had  meetings  about  policy  in  Central  America. 
We'd  had  meetings  about  the  Nicaraguan  resistance.   I  had 
been  in  a  couple  of  meetings  with  he  and  Adolf o  Calero,  and  I 
had  done  things  such  as  getting  the  resistance  leaders  to 
Washington  for  their  meeting  with  the  President.   That  type 
of  thing. 

Q    And  these  are  activities  that  you  considered  to  be 
conducting  on  his  behalf? 

A    Yes. 

Q    Who  were  the  incorporators  of  IC,  Inc.? 

A    Well,  the  two  principal  shareholders — and  I'll 
profess  a  slight  amount  of  ignorance  about  the  CayMu^n 
structure--but  the  two  principal  shareholders  are  Francis  D. 
Gomez  and  Richard  R.  Miller.  There  are  three  nominal 
shareholders  for  the  purpose  of — there's  another  legal  term-- 
but  they  are  in  effect  the  voting  members  of  the  board  of 
directors,  and  they  have  control  over  the  corporate  structure 
and  the  bank  accounts . 

Q    How  was  Mr.  Gomez  chosen  to  be  one  of  the  principal 
shareholders? 

A    You  have  to  have  two,  and  I  trusted  Frank,  implicit- 
ly- 


iiNi!iA!!!;inrn 


104 


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24 

lULLiK  KtKmrma  CO..  mc. 
)07CScrm.  NE  25 

Wuhinctoo.  DC     20002 
(2021  S46-6«M 


UNCLASSIRED 


101 


Q    You  chose  Mr.  Gomez? 

A    That's  right. 

MR.  KAPLAN;   I'll  ask  the  reporter  to  mark  as 
Exhibit  8  a  typewritten  page  of  information  relating  to  how 
to  open  accounts  and  how  to  incorporate  a  company  in  the 
Cayman  Islands. 

[The  document  referred  to  was  marked  for 
identification  as  Miller  Deposition 
Exhibit  No.  8. ] 
BY  MR.  KAPLAN: 

Q    Now  Mr.  Miller,  this  document,  Exhibit  8,  was  one 
of  the  documents  that  were  produced  to  us  by  your  counsel, 
pursuant  to  a  subpoena  issued  by  the  Committee,  and  I'm  going 
to  ask  you,  do  you  recognize,  this  document? 

A    Yes. 

Q    And  what  do  you  recognize  it  as? 

A    It's  the  elements  of  a  telephone  conversation  that 
Frank  Gomez  had  with  somebody  at  the  Barclays  Bank. 

Q    Okay.   Did  you  instruct  Mr.  Gomez  to  call  the 
Barclays  Bank  to  obtain  this  information? 

A    I  don't  recall  whether  I  instructed  him,  or  he  took 
it  on  his  own  to  do,  but  I  had  selected  the  Barclays  Bank 
after  the  conversations  with  other  people. 

Q    Do  you  recall  which  people  you  had  conversations 
with  in  decidincLto  choose  the  Barclays  Bank? 


CL  to  choose  the  Barclays 

]toil.<!<!irirn 


105 


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■LLU  RtPOKTINO  CO  ,  MC 
50;CScren.  NE  25 

Wuhuifion.  D  C      JOOO! 
1202)  M^66M 


UNCUSHD 


102 


A    Well,  I  remember  the  conversation  with  the  in- 
dividual that  led  me  to  choose  the  Barclays  Bank.   Other 
people  had  recommended  other  locations,  but  I'd  a  conversation 
with  Rodney  Cunningham  who  was,  at  the  time,  the  publisher  of 
the  Rome  Daily  American,  and  the  owner  of  two  TV  and  radio 
stations  in  Rome.   And  so  he  did  a  lot  of  banking  overseas 
and  he  had  recommended  Barclays  Bank  because  it  was  an 
English  bank,  and  that  was  the  reason  it  was  chosen. 
Q    Why  did  you  seek  Mr.  Cunningham's  advice? 
A    Because  I  was  aware  of  the  fact  that  he  did  banking 
outside  the  United  States.   I  didn't  know  that  many  people 
who  did,  and  he  was  a  good  source  of  information. 
Q    How  did  you  know  Mr.  Cunningham? 
A    I  knew  Mr.  Cunningham  from  the  campaign. 
Q    What  was  his  position  in  the  campaign? 
A    He  was  chairman  of  Citizens  Abroad  for  Reagan,  and 
communications  director  of  Republicans  Abroad. 

Q    I  think  you've  referred  to  him  before  as  a  political 
friend  of  yours? 
A    Yes. 

Q    Did  you  seek  any  legal  advice  in  setting  up,  or 
establishing  the  corporation  in  the  Cayman  Islands? 

A    Well,  the  principal  vehicle  for  setting  up  the 
corporation  was  a  law  firm. 

Q    You  testified  earlier  that  one  of  the  reasons  why 

IIMPiA55inrn 


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■UOI  UPOWTWO  CO..  MC 
ynCSum.NE.  25 

Vuhmfion.  O  C      2000} 
12011  M«.««M 


UNClASSra 


103 


you  chose  the  Cayman  Islands,  or  decided  to  set  up  an 
offshore  account  was  so  that  the  money,  the  $14  million, 
wouldn't  come  into  the  United  States  and  be  taxed  at  half. 
How  did  you  know  that  the  tax  laws  would  apply  to  money 
coming  into  the  United  States  under  this  arrangement? 

A    I  would  say  it's  probably,  at  best,  practiced — 
amateur  legal  advice.   I  mean,  I  made  the  assumption  that  the 
Internal  Revenue  Service  would  move,  immediately,  to  attach 
some  portion  of  that  money.   I  may  have  been  incorrect,  but  I 
made  that  assumption. 

I  also,  for  just  logical  reasons,  don't  see  any 
reason  to  bring  Saudi  money  into  the  United  States  in  order  to 

to  somebody ^^^^^^H^^^^^^^^^^^^^H  It 
doesn't  make  any  sense. 

Q    Was  it  your  understanding  that  if  the  money  was 
transferred  from  Saudi  Arabia  to  the  Cayman  Islands,  and  then 
to  the  contras,  that  the  money  would  avoid  taxation?   I'll 
leave  it  at  that. 

MR.  DUDLEY:   I  have  a  problem  with  the  word  "avoid" 
in  the  question,  Mr.  Kaplan,  because  it  seems  to  me  that--if 
you'll  amend  the  question  to  say  "would  not  be  subject  to 
taxation. " 

MR.  KAPLAN:   Sure.   I'll  take  that  amendment. 

THE  WITNESS:   That's  precisely  the  reason  for  doing 
it  in  the  Cayman  Islands 


mciAssra 


107 


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uulMH  wpuwmo  CO..  mc. 
MlCSutn.  NE  25 

Wuhififion.  D  C      20003 
(202)  VU-MM 


UNCLASSIFIED 


104 


BY  MR.  KAPLAN: 
Q    And  how  did  you  arrive  at  that  understanding? 

A    I'm  not  sure  I  understand. 

Q    Did  you  consult  a  lawyer  to  reach  that  conclusion? 

A    After  I  went  to  the  Cayman  Islands,  I  consulted 
with  an  attorney  in  Washington  who  told  me  that  if  it  was  set 
up  the  way  the  Cayman  people  were  saying  it  was,  that  it 
wouldn't  be  my  responsibility  to  report  it  on  a  tax  form. 

Q    Okay.   Do  you  recall  who  the  lawyer  was  that  you 
spoke  to? 

A    His  name  is  Richard  Snowden.   Dean  Snowden,  on  New 
Hampshire  Avenue.   It  was  free  legal  advice,  and  he  did  it  as 
a  friend,  and  I'm  sure  he  probably  rues  the  day  he  did  it. 

Q    Okay.   I  appreciate  that.   What  was  the  function  of 
IC,  Inc.  before  September  1985?  Did  it  do  anything? 

A    No. 

Q    Here  bank  accounts  established  in  the  name  of  IC, 
Inc .  7 

A    There  was  bank  accounts  established.   I'm  sure 
there  was  one  by  that  time.   I  don't  know  whether--I'm  sure 
there  was  only  one  at  that  time. 

Q    And  were  the  accounts  established  at  the  Barclays 


Bank? 


vHmsim 


108 


mufisro 


105 


1  Q    Okay.   So  that  the  information  that's  contained  in 

2  Exhibit  8  is  information  that  was  followed? 

3  A    Yes . 

4  Q    Okay . 

5  A    It  was  recommended  by  the  bank,  and  that's  exactly 

6  what  transpired. 

7  Q     Did  there  come  a  time  when  you  changed  the  name, 

8  and  the  charter  of  IC,  Inc.? 

9  A    Yes . 

10  Q    Do  you  recall  when  that  was? 

11  A    Well,  it  was  1986,  but  I  don't  recall  the  exact 

12  date.   I  believe  it  was  around  April. 

13  Q    What  was  the  purpose  in  the  name  change? 

14  A    Well,  IC,  Inc.  had  only  been  chosen  out  of  less  than 

15  inspirational  thought  at  my  conference  table  when  this  this 

16  supposed  Saudi  prince  was  sitting  there,  and  was  asking  for 

17  the  name  of  an  organization.   One  had  not  been  formed  yet, 

18  and  I  simply  expected  that  there  would  not  be  an  IC,  Inc., 

19  and  if  there  were  an  IC,  Inc.,  that  we'd  be  able  to  use  a 

20  combination  of  names,  sufficient  enough  to  allow  us  to  use  an 

21  "a/k/a  IC,  Inc. . " 

22  So  the  corporation  charter  request  was  for  IC, 

23  Inc.,  and  it  turns  out  there  was  no  IC,  Inc.,  so  that  was 

24  successful.   But  as  we  began  to  do  more  work  for  Colonel 

iMLiiii  wrofmta  co^  mc 

wTcsowt.  NE    25  North  in  distributing  contributions  from  other  sources,  I 

rrj  ""  iiiifti  lociFirn 


109 


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fULM  KFOHTMO  CO..  MC. 
507  C  Siren.  N  E  2  5 

Vuhmfton.  D  C     10002 
(201)  S46.6M< 


minssra 


106 


felt  that  the  organization's  name  and  its  charter  should 
reflect  what  it  was  doing  more  accurately,  and  so  I  changed 
both  of  them. 

Q    Okay.   And  when  you  say  that  you  wanted  to  change 
the  name  and  the  charter  to  reflect  more  accurate  what  IC, 
Inc.  was  doing,  how  did  you  think  that  a  neune  change  was 
going  to  reflect  more  accurately  what  IC,  Inc.  was  doing? 

A    Well,  both — the  name,  just  IC,  Inc.,  would  have  no 
significance  to  anybody,  and  the  charter  was  the  general 
Cayman  Islands'  charter,  which  is  nothing  but  a  litany  of  all 
business  practices  known  to  man,  and  it's  a  business  charter. 

And  so  what  I  did  was,  I  changed  the  charter, 
amended  the  charter,  which  seemed  to  be  unusual  for  Cayhaven's 
practices  and  for  Cayman  practices,  to  talk  about  it  in  terms 
of  distributing  to  political  and  benevolent  organizations, 
proceeds  from  like  organizations. 

And  I  chose  the  name  "International  Cooperation" 
because  it  is,  I  thought  a  little  closer  to  what  type  of  work 
it  was  doing,  and  the  only  problem  is  that  with  the  structure 
the  way  it  is  in  the  Cayman  Islands  with  these  nominal 
directors,  they  can  make  decisions,  and  there  was  an  Interna- 
tional Corporation  that  the  Cayman  Island  people  thought  that 
that  "International  Cooperation""  was  too  close. 

And  so  our  nominal  directors  arbitrarily  decided 
that  Intel  was  close  enough.   And  so  Intel  Cooperation  became 


I1NP.I  h^m^w 


no 


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tmm  Mromma  co..  mc. 
«)7CStr«t.  NE  25 

Wuhmiioa.  DC     20002 
(202)  M<-6M« 


UNCLASSIHED 


107 


the  name  because  Intel  is  a  European  convention  for  "interna- 
tional."  It  doesn't  mean  that  here,  but  it  is  an  interna- 
tional convention. 


I.e.? 


Did  IC,  Inc.  stand  for  anything?   The  initials, 

A  No. 

Q  Was  there  any  purpose  as  to  how  they  were  chosen? 

A  No. 

Q  Did  you  choose  the  name  International  Cooperation? 

A  Yes. 

Q  Did  you  consult  with  anyone  in  choosing  that  name? 

A  I  think  I  informed  Colonel  North  that  I  was  doing 


it. 


Q    Well,  what  did  Colonel  North  say  when  you  informed 
him  that  you  were  changing  the  name  of  IC,  Inc.? 

A    Well,  I  don't  recall  exactly  what  he  said  then,  but 
I  recall  what  he  said  when  he  saw  Intel  Cooperation. 

Q    what  was  that? 

A    He  said,  "What  the  hell  did  you  call  it  that  for? 
It  sounds  like  intelligence."   And  I  said  well — and  then  I 
recounted  to  him  exactly  the  story  that  I'm  recounting  to  you. 

Q    Did  North  show  some  concern  that  the  new  name  might 
reflect  "intelligence?" 

A    Well,  I  think  I  just  recounted  the  entire  exchange 
to  you,  so — 


mmm 


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Mun  RoomMo  co..  mc 

V)7CScirci.  NE  25 

Viihin[ii».  DC      lOOOl 
(202)  VM.46M 


UNCLASSIFIED 


108 


Q    Okay.   Was  North  aware  of  the  charter  amendment 
before  it  was  made? 

A    I  don't  recall  whether  I  told  him  about  it  before  I 
made  it. 

Q    Did  he  become  aware  of  the  charter  amendment  at 
some  point  after  it  was  made? 

A    I  don't  know  whether  I  told  him.   I  don't  remember 
telling  him.   It's  possible  I  told  him  and  have  forgotten, 
but  I  don't  remember  whether  I  told  him  about  the  charter 
change. 

Q    Was  it  your  understanding  at  the  time  that  the 
charter  was  changed,  that  disbursements  being  made  from  IC, 
Inc.  were  all  being  made  to — and  I'll  use  your  words-- 
political  and  benevolent  organizations? 
A    Yes . 

Q    And  you  didn't  have  any  other  understanding  to  the 
contrary? 

A    I  would  only  say  that  I  had  some  impression  that 
X^ke  Resources  was  an  entity  for  their  behalf,  but  never  any 
understanding  of  who  they  were,  or  what  precisely  it  was  they 
were . 

Q    An  entity  for  whose  behalf? 

A    For  the  resistance,  for  the  Nicaraguan  resistance. 
Q    And  did  you  know  what  the  funds  at  that  time — what 
funds  that  were  going  to  Calero  were  being  used  for? 


liMPi  Accincn 


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uNtmsro 


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507  C  SotCT.  N  E  25 

Vuhiofuxi.  DC     20002 
(202)  V««-MM 


A    Well,  for  Calero,  general  support,  humanitarian — 
food,  medicine,  salaries,  that  type  of  activity. 

Q    And  that  was  your  understanding  at  the  time? 

A    Yes. 

Q    And  did  you  believe  that  Lake  Resources  was  a 
political  or  benevolent  organization  in  April  1986? 

A    Well,  again,  I  thought  it  was  some  entity  that  was 
used  for  the  benefit  of  the  resistance,  so  when  I  use  the 
word  "political",  I  mean,  were  political.   The  Federal 
Government  is  political.   It's  a  political  entity.   It's  an 
organization.   The  resistance  is  an  organization.   It  has 
many  different  elements  to  it. 

Q    Was  the  name  change,  or  charter  amendment  of  IC, 
Inc.  in  any  way  intended  to  .provide  more  secrecy  to  the 
funneling  of  funds  that  was  going  on? 

A    No.   Actually,  I  think  it  was  the  direct  opposite. 
My  purpose,  again,  was  to  amend  the  charter  to  more  accurately 
reflect  the  business  that  the  entity  was  doing,  that  IC,  Inc 
was  doing.   It  didn't  change,  one  way  or  the  other,  the 
secrecy  associated  with  that.   In  fact,  ultimately,  what  I 
wanted  to  have  happen  was  to  have  funds  go  directly  to  Intel 
rather  than  coming  through  IBC. 

Q    But  you  had  understood  that  the  formation  of  IC, 
Inc.,  and  thfe  existence  of  this  contra-funding  network  was 


part  of  a  covert  operation,  had  you  not? 


\m\  A^^intn 


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507  C  SirtCT.  N  E                  2  5 
Vuhinttoa.  0  C     10002 
(«»)  Mt-<t66 


WSXIflfl) 


110 


A    Well,  I  want  to  answer  your  question  in  two  parts. 
We  formed  IC,  Inc.  to  handle  a  specific  transaction  which  did 
not  happen,  but  it  was  formed  specifically  to  handle  that 
transaction.   In  a  subsequent  period  of  time,  when  we  started 
to  raise  money  from  private  sources,  it  became  the  appropriate 
vehicle,  again,  to  transfer  money  to  these  political  entities 

Q    You  testified  at  one  of  the  earlier  sessions  of 
your  deposition,  that  some  time  in  1985,  in  I  believe  Colonel 
North's  office,  he  sat  down  with  you  and  Robert  Earl,  drew 
out  a  little  chart  which  has  probably  since  become  famous,  and 
in  drawing  out  that  chart  with  little  boxes,  and  filling  in 
NEPL  and  IBC,  and  IC,  Inc.,  and  whatnot,  he  said  something  to 
you  to  the  effect  of,  "This  is  the  way  a  real  covert  operation 
should  work. * 

THE  WITNESS:   Wait  a  minute.   You  have  200  percent 
overstated. 

MR.  DUDLEY:   You're  really  inaccurate  there. 

THE  WITNESS:   Let  me  tell  you  exactly  what  happened 

MR.  KAPLAN:   Well,  why  don't  we  get  it  accurate, 
and  while  you're  telling  me  what's  accurate,  I'm  going  to 
pull  out  the  earlier  testimony. 

THE  WITNESS:   Okay.   I  went  to  see  Colonel  North 
and  had  a  conversation  with  him--I  believe  it  was  about 
^^^^^^^^H-but  there  was  some  word  in  the  diplomatic 
community  that  there  was  going  to  be  some  kind  of  a  public- 


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■MUIR  •BFOmaM  CO^  MC 
»7  C  Sam.  N  E.  2  5 

Wuluii(raa.  DC.    2000] 
(102)  >4t-MM 


UNCLASSIFIED 


111 


relations  effort  for  one  of  the  other  resistance  movements, 
and  I  think  it  wa 

And  I  went  to  hlin  to  talk  about  it,  to  find  out  who 
I'd  get  in  touch  with  because  we  wanted  some  IBC  work  in  the 
area.   And-- 

MR.  LEON:  ;  Do  you  have  a  time-frame  for  this,  Rich? 

THE  WITNESS:   All  I  remember  is  it  was  his  old 
office.   That's  the  only  thing  I  can  recall.   It  was  his  old 
office.   So  it  was  some  time  before  he  moved  into  his  new 
office.   And  I  told  him  what  I  wanted  to  do  and  he  said, 
"Okay.   Let  me  show  you  how  a  covert  operation  is  set  up.' 

And  he  called  Bob  Earl  into  the  room  and  told  him 
to  bring  some  piece  of  paper.   And  when  it  came  in,  it  was  on 
a  yellow  pad  like  a  lined  legal  pad,  but  It  didn't  have  all 
the  boxes  that  the  one  in  the  Tower  Commission  report  has. 

It  wasn't  quite  that  complicated.   And  he  said, 
"Let  me  show  you  how  a  covert  operation  is  set  up."   I'm  not 
sure  whether  Earl  was  still  In  the  room  at  that  point,  but  I 
was  on  the  couch,  and  he  set  It  down  on  the  coffee  table. 

He  no  sooner  got  those  words  out  of  his  mouth  than 
his  secure  telephone  went  off.   He  had  to  take  a  phone  call  on 
the  secure  line.  It  proceeded  for  a  few  minutes,  and  then  he 
said  "You'll  have  to  leave,"  and  I  left,  and  I  have  never  had 
the  chart  fully  explained  to  me. 

But  I  remember  seeing  ACT,  and  I  remember  seeing 


iiMi»LA5Cincn 


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J07  C  Scrm.  N  E  25 

Vuhiii(nxi.  0  C     20002 
(202)  V4«-MM 


UNCLASSIFIED 


112 


NEPL,  and  I  remember  seeing  IC,  Inc.   I  don't  think  I  ever 
noticed  INSI.   I  think  I  probably  would  have  remembered  that. 
But  I  remember  it  was  not  as  complicated  as  the  one 
I've  seen  in  the  Tower  Commission  report. 
BY  MR.  KAPLAN: 

Q    And  when  you  say  the  one  you've  seen  in  the  Tower 
Commission  report,  just  for  the  record,  that  chart  was  marked 
as  Exhibit  7  at  your  deposition  session  on  July  3rd. 

Was  IBC  on  the  chart  that  Colonel  North  drew  out? 

A    I  believe  IBC  was  on  the  chart,  to  tell  you  the 
truth. 

Q    All  right.   And  in  terms  of  setting  a  date  as  to 
when  that  chart  was  drawn,  does  it  refresh  your  recollection 
as  to  timing,  that  IC,  Inc.  appeared  on  that  chart? 

A    Well,  it's  a  good  point.   I  would  assxune  that  it  was 
some  time  after  April  1985. 

Q    Okay. 

MR.  DUDLEY:   I  have  a  problem  with  the  way  that 
you're  using  the  phrase  "drawn  out."   I  mean,  I  think  the 
problem  Rich  is  having  with  it  is,  I  don't  want  the  implica- 
tion to  be  made  that  the  chart  was  drawn  in  his  presence,  or 
that  he  had  anything  to  do  with  the  drawing  of  the  chart,  and 
by  answering  questions,  that  you  used  the  phrase  "drawn  out." 
I  don't  think  you're  intending  to  make  that  conclusion,  right? 
THE  WITNESS:   No.   I  was  shown  the  piece  of  paper 


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M7  C  Sunt.  N  E  25 

Vuhuftoa.  D  C.    10002 
(202)  H6-6ti6 


113 


that  already  had  drawing  on  it,  and,  ultimately,  left  without 
having  it  fully  explained  to  me. 

BY  MR.  KAPLAN: 

Q    Nonetheless,  was  it  your  understanding  that  the 
NEPL,  IBC,  IC,  Inc.  conduit  relationship  was  a  secret 
relationship,  or  a  part  of  some  kind  of  a  secret  operation? 

A    Well,  I  don't  agree  with  your  characterization  of 
"secret",  but  let  me  tell  you  why. 

Q    Why  don't  you  explain. 

A    And  I  think  I  understand  what  your  question  is, 
now.   Two  of  the  things  that  we — the  first  and  foremost  thing, 
in  terms  of  NEPL,  and  the  resistance,  was  that  we  wanted  some 
insulation  between  the  two  of  them.   We  didn't  want  to  have 
the  resistance  bugging  Spitz  Channell  for  money,  and  we 
didn't  want  Spitz  Channell  conversant  with  the  way  the  money 
was  ultimately  distributed. 

And  when  I  say  "we",  I  say  myself  and  Colonel  North 
as  well.   And  that  was  just  good  practice  not  to  have  that 
happen.   Spitz  had  participated  once  before  in  an  event  that 
benefited  the  Nicaraguan  exile  community,  and  had  subsequently 
been — had  unsolicited  requests  for  money. 

Secondly,  we  were  both  aware  that  there  was  a  great 
deal  of  interest  in  our  activities  by  the  Nicaraguans  and  the 
Cubans,  and  we  took  precautions  all  the  tJ.me,  not  to  be  in 


h<mm 


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open- telephone  conversations,  not  to  have  organizations  be 
readily  available  for  public  view.   So  that  was  quite 
certainly  part  of  why  we  set  things  up  the  way  we  set  them  up. 

Q    Weren't  you  also  concerned  about  exposure  of  your 
activities  in  the  American  press? 

A    Of  course. 

Q    And  weren't  you  concerned  about  the  exposure  of 
your  activities  to  the  Congress? 

A    No. 

Q    Not  at  all? 

A    I  wasn't.   I  should  say  that. 

Q    To  your  knowledge,  was  Colonel  North  concerned  about 
the  exposure  of  his  involvement  with  your  activities  to  the 
Congress? 

A    I  wouldn't  want  to  characterize  what  he  was  feeling 
at  the  time.   The  point  I'd  make  to  you  is  that  every  transac- 
tion we  undertook  was  done  either  through  bank  draft  by  a 
meaber  of  the  Federal  Deposit  System,  the  Federal  Reserve 
System.   It  was  done  by  Federal 


from  the 
proper  authorities,  we  never — I  never  thought  I  was  hiding 
anything. 


les ,    we    never: — a.    nevet    tni 

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M)7CSi«ti.  NE  25 

Vuhiofioo.  O  C      10002 
(20!)  M6-MM 


mwsm 


115 


Q    The  name  change  in  1986,  were  you  concerned,  or  was 
there  any  concern  expressed^by  anybotly,  that  by  changing  the 
name  and  amending  the  charter  in  1986,  that  would  give  rise 
to  more  exposure  to  the  activities- of  IC,  Inc.? 
A    No. 

Q    Okay.   But  your  testimony  here  today  is  that  the 
charter  was  not  eunended  and  the  n£une  was  not  changed  for  the 
purpose  of  providing  either  in  whole,  or  in  part,  greater 
secrecy  to  the  operation? 

A    I  don't  think  it  increased  it  or  decreased  it, 
either  way. 

Q     I'm  asking  for  what  the  purpose  was,  either  in 
whole  or  in  part. 

A    Well,  ultimately,  4fhat  we — 

MR.  DUDLEY:   Is  your  question  still  limited?  Was 
the  purpose  in  whole  or  in  part  to  provide  additional 
secrecy?   Is  that  what  you're  asking? 
MR.  KAPLAN:   That's  correct. 

MR.  DUDLEY:   Okay.   Why  don't  you  answer  that 
question. 

THE  WITNESS:   I  don't  recall  it  being  one  of  the 
purposes  for  why.   I  recall,  most  certainly,  the  primary 
purpose,  which  was  to  have  it  reflect  more  clearly  what  the 
organization  was  doing.  .  -  -  ■  '.  ' 

MR.  KAPLAN:   All  right.   l' understand  that. 


iiMoi  A^cinrn 


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W  C  Snci.  N  E.  2  5 

Wailiiii(iaa.  DC     20002 
(202)  }4«-M«« 


iwssro 


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BY   MR.    KAPLAN: 

Q    Was  one  of  the  purposes  either,  in  your  mind,  or  to 
your  knowledge,  in  someone  else's  mind,  to  provide  greater 
secrecy  to  the  operation? 

A    Sitting  here  now,  I  don't  recall  greater  secrecy 
being  one  of  the  reasons  why  I  changed  the  charter.   If  I 
might  answer  your  question  even  more  directly,  the  charter 
change  was  more  explicit  about  the  type  of  function  of  the 
organization  than  was  the  original  charter.   So,  actually,  I 
think  it  has  the  opposite  effect. 

I  think  the  charter  change  had  the  opposite  effect. 

Q    It's  your  testimony  here  today,  then,  that  that 
charter  change,  that  is,  describing  the  IC,  Inc.  activities 
as  involving  grants  to  political  and  benevolent  organizations, 
even  given  the  knowledge  that  you  now  know,  and  that  you  now 
have,  was  more  accurate  in  April  or  May  of  1986  to  describe 
the  functions  of  that  organization? 

A    Sure.   More  accurate  than  the  previous  charter. 
Absolutely. 

Q    And  given  what  you  know  today,  is  it  your  testimony 
that  a  charter  change  to  describe  IC,  Inc.'s  activities  as 
being  (1)  to  provide  grants  to  political  and  benevolent 
organizations,  was  more  accurate  in  light  of  the  funding  that 
was  being  made  to  Lake  Resources,  and  Calero's  accounts? 


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M7  C  So«i.  N  E  2  5 

WuhiniToil.  D  C      20002 
(202)  )4&-«66« 


(IHWSSW 


117 


A  Yes. 

MR.  DUDLEY:   I'm  going  to  object  to  the  form  and 
tone  of  these  questions,  and  point  out  to  you  that  one  of  the 
problems  with  it  is  "more  accurate  than  what?"  The  prior 
charter  contained  no  reference  to  those  activities,  so  any 
reference  would  technically  be  more  accurate. 

Are  you  suggesting  there  is  an  inaccuracy,  and  if 
you  want  to  suggest  that,  why  don't  you  ask  him,  directly? 

MR.  KAPLAN:   Well,  I'd  like  an  answer  to  my  previous 
question. 

[The  pending  question  was  read  by  the  reporter.] 

MR.  DUDLEY:   I  don't  think  the  question  is  answer- 
able in  that  form.   More  accurate  than  what? 

MR.  KAPLAN:   More  accurate  than  the  previous 
charter. 

THE  WITNESS:   Yes,  I  think  it  was  more  accurate 
than  the  previous  charter. 

BY  MR.  KAPLAN: 
Q    In  light  of  what  you  know  today,  is  it  your 
testimony  that  the  charter  amendment  is  an  accurate  descrip- 
tion of  the  activities  that  were  being  conducted  through  IC, 
Inc.  at  that  time? 

A    Yes.   You've  also  used  my  memory  of  the  charter 
change  as  the  sole  parameters  of  the  charter  change.   If  you 
have  it  here,  I  suggest  you  look  at  it,  and  it's  slightly 


llllftl  Iftrtrriri% 


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Wuhinfion.  D  C      20002 
(2021  ■A6-M6i 


ttHttkSSW 


118 


broader  than  that. 

Q    Your  memory  of  the  charter  change  is  fine  with  me. 
It's  what  you  testified  to  under  oath  here  today.   So  your 
testimony  is,  as  you  sit  here  today--your  understanding  is 
that  it  is  accurate  to  say  that  the  activities  of  IC,  Inc. 
were  to  provide  funding  to  political  and  benevolent  organiza- 
tions? 

MR.  DUDLEY:  Again,  Mr.  Kaplan,  I  don't  know  how 
many  times  you  want  to  ask  the  question.  You're  obviously 
not  getting  the  answer  you  want. 

I  don't  know  how  many  times  he's  got  to  sit  here 
and  answer  it,  but — 

MR.  KAPLAN:   I  haven't  gotten  an  answer  to  that 
question,  counsel,  and  I'm  gping  to  pursue  it  until  I  get  an 
answer  to  that  question. 

MR.  DUDLEY:  I'm  going  to  finish  my  statement  on 
the  record. 

MR.  KAPLAN:  I've  rephrased  the  question  as  you've 
requested  that  I  rephrase  it.  Now  that  it's  been  rephrased, 
I'd  like  an  answer  to  it.   That's  not  difficult. 

MR.  DUDLEY:   I  would  like  to  point  out  that  the  one 
item  that  you  have  landed  on  is  only  one  of  several  purposes 
listed  in  the  charter,  and  if  your  question  is--as  it  can 
only  be--was  that  one  of  the  activities  that  was  being 
carried  out,  because  it  is  one  of  the  activities  that  is 


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■■xiii  Rvomwa  CO..  mc. 

507  C  Sum.  N  E  25 

Vuhuifioo.  D  C      20002 
(202)  M«-MM 


uNcussra 


119 


described,  then  I'll  be  happy  to  have  him  answer. 

MR.  KAPLAN:   That  wasn't  my  question.   Again,  I 
rephrased  the  question  as  you  requested. 

MR.  DUDLEY:   No,  you  didn't.   Not  that  question. 

MR.  KAPLAN:   Which  is,  is  his  testimony  today  that 
the  charter  amendment  is  an  accurate  reflection  of  the 
activities  that  IC,  Inc.  was  conducting  at  the  time,  in  light 
of  his  knowledge  today.   It's  not  a  hard  question. 

MR.  DUDLEY:   That  was  not — 

MR.  KAPLAN:   It's  not  a  difficult  question  to 
understand,  and  I  would  like  an  answer  to  it,  please,  Mr. 
Miller. 

THE  WITNESS:   What  was  the  question,  again? 

MR.  DUDLEY;   I  want  to  get  it  straight  because  it 
is  a  confusing  and  loaded  question. 

MR.  KAPLAN:   In  light  of  your  knowledge  today,  is 
it  your  testimony  that  the  activities  that  were  being 
conducted  by  IC,  Inc.  were  accurately  reflected  by  that 
charter  amendment  that  was  made  back  in  April  or  May  of  1986? 

THE  WITNESS:   Yes. 

BY  MR.  KAPLAN: 
Q    And  was  funding,  in  light  of  the  knowledge  that  you 
have  today,  to  Lake  Resources,  and  to  Calero,  considered  by 
you  to  be  funding  to  political  or  benevolent  organizations? 


A    Yes. 


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Q    And  do  you  have  any  understanding  today,  as  to 
whether  Lake  Resources,  or  Mr.  Calero,  or  persons  administer- 
ing the  money  coining  from  those  accounts ,  used  those  funds  for 
anything  other  than  political  and  benevolent  purposes? 

A    You've  misread  the  charter  change.   It  says  it  is 
to  give  money  to  political  and  benevolent  organizations. 

Q    And  is  it  your  understanding  that  Lake  Resources  is 
a  political  or  benevolent  organization? 

A    Well,  my  understanding  today  is — 

Q    That's  what  I'm  asking  for. 

A    — predicated  on  the  hearings,  and  I'm  quite  aware 
that  Mr.  Hakim  and  Mr.  Secord  operated  an  organization  for 
the  benefit  of  the  Nicaraguan  resistance,  and  I  accept  their 
characterization. 

Q    And  I  mean,  are  you  testifying  that  it's  your 
understanding,  in  light  of  the  knowledge  that  you  have  today, 
that  Lake  Resources  is  a  political  or  benevolent  organization? 
MR.  DUDLEY:   That's  not  what  he  said. 
THE  WITNESS:   I'll  repeat  exactly  what  I  said,  and 
that  is,  it  is  my  understanding,  based  on  the  testimony  which 
I  was  able  to  watch,  that  Mr.  Hakim  and  Mr.  Secord,  and  their 
associates,  operated  an  organization  for  the  benefit  of  the 
Nicaraguan  resistance. 

BY  MR.  KAPLAN: 

Q    And  I'm  asking  you,  and  I've  asked  it  eight  times. 


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and  I  have  yet  to  get  an  answer — okay — 

MR.  DUDLEY:   Why  don't  you  tell  him  what  you  mean 
by  a  "political  and  benevolent  organization." 

MR.  KAPLAN:   It  is  Mr.  Miller's  charter  amendment 
to  which  he  testified. earlier,  and  I  assume  he  has  an 
understanding  of  it.   Now  if  he's  going  to  answer  the 
question  in  the  affirmative,  then  I'm  going  to  ask  him  what 
he  means  by  "political  or  benevolent  organization. " 

MR.  DUDLEY:   Well,  I  consider — 

MR.  KAPLAN:   Do  you  understand  Lake  Resources  to  be 
a  political  or  benevolent  organization? 

THE  WITNESS:   Now,  no. 

BY  MR.  KAPLAN: 
Q    Okay.   And  do  you  .understand  that  the  activities, 
then,  that  IC,  Inc.  was  conducting,  in  funding  Lake  Resources- 
-and  I'm  limiting  it  to  that — was  an  activity  of  providing 
grants  to  a  political  or  benevolent  organization? 
A    No. 

Q    Okay.   That  was  easy.   I  think  we  could  have  done 
that  about  15  minutes  ago. 

MR.  DUDLEY:   I  don't  think  we  need  gratuitous 
comments.   Why  don't  you  ask  questions,  Mr.  Kaplan. 

MR.  KAPLAN:   Thank  you,  counsel. 

BY  MR.  KAPLAN: 
Q    Is  it  your  testimony  here  today,  that  one  of  the 


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purposes  of  the  name  change,  or  a  charter  amendment  to  IC, 
Inc.,  was  not  in  whole,  or  in  part,  by  you,  or  to  your 
knowledge,  by  anyone  else,  an  effort  to  better  cover  the 
activities  of  IC,  Inc.? 

MR.  DUDLEY:   That's  about  the  twelfth  time  it's 
been  asked.   Answer  it  once  again,  and  this  is  the  last  time 
he's  going  to  answer  it. 

THE  WITNESS:   I  don't  recall  that  being  one  of  the 
purposes  for  changing  the  name. 

MR.  KAPLAN:   Okay.   Thank  you. 

I  ask  the  reporter  to  mark  as  Exhibit  9  a  handwrit- 
ten document,  that  also  was  produced  by  your  counsel  in 
response  to  the  Committee's  subpoenas,  and  ask  you  if  you  can 
identify  that  document. 

[The  document  referred  to  was  marked  for 
identification  as  Miller  Deposition 
Exhibit  No .  9 . ] 
THE  WITNESS:   Yes.   It  was  a  draft  for  a  Telex  to 
go  to  David  Piesing  who  was  the  administrator  for  our  account 
at  Cayhaven  Corporate  Services  in  the  Grand  Cayman  Islands. 
MR.  KAPLAN:   Okay. 
BY  MR.  KAPLAN: 
Is  that  your  handwriting? 
Yes. 


Did  you  prepare  this  draft  yourself? 

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A         Yes. 

Q    Was  it  reviewed  by  anyone,  do  you  recall? 

A    No. 

Q    And  I  take  it  that  this  draft  confirms  that  you 
intended  to  rename  the  corporation  International  Cooperation, 
Inc.,  if  you'll  look  on  page  two  of  the  draft,  toward  the 
middle  of  the  page? 

A    Yes. 

Q    Okay.   Was  Mr.  Gomez  consulted? 

A    I'm  sure  I  informed  him  of  this. 

Q    Would  he  have  had  any  input  into  the  draft? 

A     I  don't  think  so. 

Q    Do  you  recall  whether  Colonel  North  was  consulted 
before  the  draft  was  put  int.o  Telex  form? 

A    No. 

Q    And  would  he  have  had  any  input  into  the  preparation 
of  the  draft? 

A    No.   This  never  happened,  by  the  way. 

MR.  DUDLEY:   By  that  you  mean  the  draft  wasn't  sent? 
THE  WITNESS:   No,  the  draft  was  sent  but  the 
actions  described  here  did  not  happen. 
MR.  KAPLAN:   Okay. 
BY  MR.  KAPLAN: 

Q    I  think  it  would  be  useful  to  clarify  the  record, 
if  you  could  explain  a  little  further  what  you  mean  when  you 


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say  that  what's  described  in  that  draft,  that  is.  Exhibit  9, 
never  happened. 

A    The  counsel  on  the  other  end  of  this  Telex,  the 
Walker  &  Company--! 'm  sorry,  this  did  happen.   This  is  a 
subsequent  Telex  to  our  initial — there's  another  Telex  which 
asks  that  we  change  the  corporate  structure  of  IC,  Inc. 
significantly,  and  place  on  it,  in  it,  corporate  officers, 
and  they  refused  to  do  that,  and  this  was  a  compromise  to 
their  position. 

So  that  what  happened  was,  we  ended  up  with  IC, 
Inc.  and  a  charter  change,  and  we  ended  up  also  with  world 
Affairs  Council. 

Q    Do  you  recall  when  you  informed  Colonel  North  of 
that  name  change  of  Intel  Cooperation,  Inc.? 

A    I'm  pretty  certain  it  was  after  the  fact. 

Q    And  I  take  it,  then,  that  would  be  the  same  with 
respect  to  the  charter  amendment? 

A    I  believe,  also,  that  was  after  the  fact. 

Q    Do  you  recall  telling  Colonel  North  about  the 
charter  amendment,  or  the  substance  of  the  charter  amendment? 

A    I  don't  have  a  specific  recollection  of  a  conversa- 
tion.  I  do  remember  the  exchange  I  told  you  about  earlier, 
about  the  name  change,  but  I  don't  recall  having — I  don't 
have  any  specific  recollection  of  a  conversation  about  the 


charter  change. 


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■f 
Q    Okay.   Let's  move  of^this.  When  did  you  meet 

Colonel  North,  initially? 

A    Well,  actually,  your  previous  depositions  refresh 
my  memory.   Some  time  in  1984,  and  I've  seen  a  September  date 
in  his  appointment  book,  so  some  time  in  the  fall,  I  would 
guess. 

Q    Do  you  recall  the  context  in  which  you  first  met 
Colonel  North? 

A    No,  but  I  have  a  very  faint  recollection  that  it 
had  more  to  do  with ^^^^^^^^H than  anything  else. 

Q    And  why  do  you  believe  it  had  to  do  with] 


A  It  was  at  a  period  of  time  when  our  work  for  the 
State  Department  was  centered  primarily  on  ^^^^^^^^Hand 
the  problems  that ^^^^^^^H^ was  facing. 

Q    Do  you  recall  who  referred  you  to  Colonel  North,  or 
who  introduced  you  to  hin? 

A    I  don't  have  a  specific  recollection. 

Q    Do  you  have  any  recollection? 

A    I  have  an  assumption,  and  the  assumption  would  be 
that  it  would  have  been  Jonathan  Miller  or  Ambassador  Reich, 
one  of  the  people  at  the  State  Department. 

Q    why  do  you  assume  that  it  would  have  been  either 
Jonathan  Miller  or  Reich?  On  what  do  you  base  that  assump- 
tion?  I'm  not  trying  to — 


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A    they  would  have  been  the  only  people  of  enough 
stature  to  have  had  contact  with  him,  that  would  have  drawn 
us  into  contact  with  him. 

Q    Do  you  recall  any  of  the  substance  of  that  first, 
or  those  initial  meetings  about  ^HH^^^^^ 

A    No;  no.   In  fact  the  only  two  things  I  can  recall 
are  a  luncheon  in  our  offices  with  Ambassador  Reich,  Jonathan 
Miller,  Oliver  North,  Frank  Gomez  and  myself,  and  instances 
where  we  went  to  Colonel  North's  office  to  assist  with  the 
Washington  visit  of  the  Nicaraguan  resistance  leaders.   Those 
are  the  only  two  that  I  have  clear  recollections  from  that 
period  of  time. 

Q    Do  you  recall  your  first  dealings  with  Colonel 
North  that  related  to  Nicara.guan,  specifically? 

A    I  don't  specifically  recall,  no.   I  wouldn't  know 
which  one  to  say  was  the  first.   I  mean,  I  don't  have  a 
specific  recollection. 

Q    When  would  your  first  Nicaraguan-related  contacts 
with  Colonel  North  have  occurred?  Approximately. 

A    Probably  the  winter  of  1984-85. 

Q    And  you  testified  earlier,  I  believe,  that  you  had 
done  some  work  in  coordinating  or  setting  up  a  Nicaraguan 
Refugee  Fund  dinner.   Did  you  have  dealings  with  Colonel 
North  in  connection  with  your  work  setting  up  that  dinner? 

A    We  did  not  have  a  role  setting  up  the  dinner.   We 


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were  observers  at  the  dinner,  on  behalf  of  Adolfo  Calero  and 
the  Nicaraguan  Development  Council. 

Q    Did  your  role  as  observers  start  prior  to  the 
dinner?   I  realize  the  dinner  was  postponed  a  couple  of  times. 

A    Yes.   In  fact  I  attended  a  meeting--!  believe  it 
was  in  January--at  the  offices  of  Miner  &  Fraser,  which  was 
supposed  to  be  an  organization  meeting  of  all  the  different 
groups  participating,  and  one  of  the  people  there  was  Spitz 
Channell . 

And  we  reported  our  impression  to  the  State 
Department  and  to  Colonel  North. 

Q    Any  other  dealings  with  North  in  connection  with 
that  dinner? 

A    I  don't  right  this  minute  recall  any  others.   I 
mean,  I  saw  him  at  the  dinner.   He  was  aware  of  the  general 
arrangements,  but  I  don't  have  anything  specific  in  memory 
about  it. 

Q    Do  you  recall  any  other  dealings  with  Channell  in 
connection  with  your  observation  role  for  that  dinner? 

A    No.   I  approached  him  at  the  meeting  and  introduced 
myself  and  gave  him  my  card,  and  he  sort  of  took  it  very 
lightly,  and  I  got  the  feeling,  when  I  left  the  room,  I'd 
never  hear  from  him  again. 

Q    Well,  was  North  commonly  referred  to  around  IBC  by 


a   code   name? 


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A    Not--well,  yes. 

Q    And  what  was  that  name? 

A  When  we  had  telephone  conversations,  or  when  we 
were  conunitting  something  to  writing,  we  simply  wrote  the 
word  "Green. " 

Q    When  was  the  name  coined? 

A  Some  time  in  the  summer,  late  summer  or  fall  of 
1985. 

Q    And  do  you  recall  who  coined  it? 

A    Actually,  Frank  Gomez  coined  it. 

Q    And  why  was  the  name  Green  used  to  refer  to  North? 

A    It  was  originally  Frank's  concern  for  holding  open 
telephone  conversations,  which  the  Channell  people  were — as 
most  civilians  are — were  won.t  to  do,  and  rather  than  using 
North's  name  over  an  open  telephone  line,  Frank  suggested 
that  they  use  the  name  "Mr.  Green  Jeans"  and  that  referred  to 
his  fatigues,  and  they  shortened  it  to  Green,  and  it  became  a 
convention  to  use  Green. 

Q    Have  you  ever  seen  North  in  fatigues? 

A    No. 

Q    Had  Gomez  ever  seen  North  in  fatigues? 

A    No. 

Q    Did  he  have  any  reason  why  he  would  choose  a  name 
that  referred  to  North's  fatigues? 

A    Well,  he's  a  20-year  Foreign  Service  officer,  and 


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129 


he  tells  me  that  that's  done,  and  that  when  you  choose  a  name 
such  as  that,  you  do  it  for  something  that  will  commit  it  to 
memory,  something  that's  akin  to  the  individual. 

Q    You  said  just  a  moment  ago  that  Channell  and  his 
associates  would  use  North's  name  over  phone  lines  as 
civilians  were  wont  to  do,  and  I  take  it  you  considered 
yourself  and  your  IBC  associates  as  civilians  as  well? 

A    Sure. 


A    I've  had  four  security  clearances,  and  in  one 
instance  a  "Q"  clearance  which  I  don't  think  they  use 
anymore. 


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Q    The  security  clearances  that  you've  had  previously, 
were  they  in  connection  with  positions  you  held  within 
Government? 

A    That's  correct. 

Q    And  those  were  the  positions  at  the  State  Department 
and  AID  that  you  testified  about  previously? 

A    And  at  the  General  Services  Administration. 

Q    Have  you  ever  held  a  security  clearance  outside  of 
the  Government? 

A    We  had  a  security  .clearance  as  a  contractor  on  our 
last  State  Department  contract. 

Q    And  do  you  recall  at  what  level  that  clearance  was? 

A    I  believe  it  was  Secret. 

Q    Who  asked  that  that  clearance  be  provided? 

A    The  State  Department. 

Q    And  any  particular  individual  at  the  State  Depart- 
ment? 

A  Well,  I  always  was  under  the  impression,  prior  to 
reading  the  report  from  the  State  Department,  that  Jonathan 
Miller  was  the  individual  that  asked  for  it. 

Q 


Has  that  clearance  now  expired? 

iiiuiuocincn 


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A    For  all  intents  and  purposes,  yes. 

Q    And  has  the  contract  pursuant  to  which  you  were 
cleared  expired? 

A    Yes. 

Q    And  when  did  that  expiration  occur? 

A    September  30  of  1986. 

Q    When  did  you  meet — 

A    May  I  add  something? 

Q    Sure . 

A    Frank  Gomez  was  in  the  Foreign  Service  for  20 
years,  and  has  had  his  assistant  blown  up  in  the  room  right 
next  to  him.   So  that  anybody  that  serves  in  foreign  posts 
like  that  has  a  great  sensitivity  to  the  problem  of  open 
telephone  lines,  and  anybody  that's  conversant  with  Washington 
knows  that  open  telephone  lines  here  are  monitored  by  the 
Soviet  complex  in  Cuba.   There's  no  mystery  about  that. 

So  I'm  sure  when  each  of  you  took  your  oath  and  got 
your  security  clearances,  you  were  briefed  by  security 
officers  about  that  kind  of  activity.   So,  if  we're  dealing 
in  sensitive  matters,  it's  only  intelligent  for  us  to  do  it 
in  a  way  that  secured  us  enough,  that  it  makes  it  difficult 
for  the  Soviets  to  keep  track  of  it. 

And  I  suspect  they'd  be  interested  in  any  kind  of 
assistance  to  the  Nicaraguan  resistance,  political  or 


otherwise. 


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Q    At  IBC,  do  you  and  Frank  Gomez  maintain  separate 
offices? 

A    Yes. 

Q    Is  that  because  of  your  knowledge  of  the  history  of 
what's  happened  to  some  of  his  assistants  in  the  past? 

MR.  DUDLEY:   Let  the  record  show  that  everybody 
laughed. 

MR.  KAPLANS   Let  the  record  show  that  I  very  much 
appreciate  the  laughter. 

MR.  LEON:  I  thought  that  was  a  strategic  question, 


John. 


BY  MR.  KAPLAN: 

Did  North  ever  tell  you  anything  aboutl 


A    Yes,  and  can  we  go  off  the  record  for  a  minute. 

MR.  KAPLAN:   Sure. 

[Discussion  off  the  record.] 

MR.  KAPLAN:   Back  on  the  record. 

MR.  KAPIiANs   In  an  of f-the-record  discussion  which 
just  occurred  among  counsel  and  Mr.  Miller,  in  the  absence  of 
the  reporter  who  is  not  cleared,  we  all  arrived  at  a  consensus 
conclusion,  that  certain  information  that  Mr.  Miller  may  have 
to  convey  to  the  Committees  might  well  be  of  a  classified 
nature. 


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If  the  Committees  decide  to  pursue  the  line  of 
questioning,  which  would  give  rise  to  testimony  relating  to 
that  information,  we  will  do  it  at  a  later  date  and  ap- 
propriate time,  mutually  agreed  upon,  in  which  the  Committees 
will  have  secured  a  cleared  reporter  for  the  taking  of  that 
deposition,  or  that  testimony,  and  that  testimony  will  be 
handled  pursuant  to  the  normal  security  procedures  of 
classified  information  that's  been  employed  by  the  Committees 
since  their  inception. 

Does  anyone  have  anything  to  add  or  subtract  from 
that  statement? 

[No  response. ] 

MR.  KAPLAN:   All  right. 

BY  MR.  KAPLAN: 

Q    When  did  you  first  meet  John  Roberts? 

A    In  the  month  of  August  1980. 

Q    And  do  you  recall  the  context  in  which  you  met  him? 

A    Yeah.   John  was  in  charge  of  the  editorial  responses 
for  the  Reagan-Bush  campaign,  and  I  was  in  charge  of  the 
radio  news  service. 

Q    What  was  the  substance  of  your  relationship  at  that 
time? 

A    Friends  and  co-workers . 

Q    Okay.   And  did  you  continue  as  friends  with  John 
Roberts  subsequent  to  the  campaign? 

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A         Yes. 

Q    How  would  you  describe  the  friendship? 
A    We  were  very  good  friends.   We  had  very  similar 
political  beliefs,  and  enjoyed  a  good  friendship. 

Q    Did  you  have  further  professional  dealings  with  Mr 
Roberts  after  the  campaign?   That  is,  the  1980  campaign. 

Q    I  had  some  contact  with  him  when  he  was  in  the 
political  office.   At  the  time  I  was  in  AID,  and  subsequent  to 
my  leaving  AID,  I  kept  in  contact  with  the  political  office, 
and  he  was  stationed  in  the  political  office. 

Q    What  do  you  mean,  when  you  refer  to  the  "political 
office?" 

A    There  is  an  office  of  the  Assistant  to  the  President 
for  Political  Affairs  in  the.  Of f ice  of  the  President. 

Q    Okay.   So  his  office  was  in  the  White  House? 

A    That ' s  correct . 

Q    Do  you  recall  what  Mr.  Roberts'  position  was  in 
early  1985? 

A    At  some  point  in  mid-1985  he  had  the  title  of 
Deputy,  I  believe.   If  not,  he  was  an  assistant  to  the 
director. 

Q    All  right.   And  again,  to  clarify  the  record, 
assistant  to  the  director  of  what? 

A    Well,  director  of  the  Political  Office,  who  also 
carries  the  title  of  Assistant  to  the  President  for  Political 

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affairs. 

Q    Okay.   When  did  you  first  meet  Spitz  Channell? 

A    I  met  Spitz  at  that  meeting  I  recalled  in  January, 
and  then  the  next  time  I  met  Spitz  Channell  was  in  April  of 
1985.   And  I  got  a  call  from  John  Roberts  who  told  me  that  he 
had  had  two  fellows  come  see  him  who  wanted  to  help  the 
President  on  the  Nicaraguan  aid  vote,  and  would  I  like  to  see 
them  and  I  said  sure,  I  considered  it  a  professional  referral. 
And  I  met  with  Mr.  Channell  and  Mr.  Conrad,  along  with  Frank 
Gomez,  who  provided  them  stacks  of  information  which  they 
used  to  produce  some  series  of  television  commercials. 

And  shortly  thereafter,  they  retained  IBC  for 
consulting. 

Q    When  was  it  that  you  received  the  call  from  Roberts 
alerting  you  to  the  fact  that  Channell  and  Conrad  would  be 
calling  on  you? 

A    I  don't  recall  the  date,  specifically,  but  it  was  in 
April  of  '85. 

Q    And  did  you  meet  with  Conrad  and  Channell  some  time 
shortly  thereafter? 

A    I  think  it  was  this  same  day  or — 

Q    That  same  day? 

A    Or  within  a  very  short  period  of  time.   If  it 
wasn't  the  same  day,  it  was  the  next  day. 

Q    So  they  probably  called  you  the  same  day  that 


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Roberts  called  you  to  alert  you  to  the  phone  call — 

A    Actually,  I  think  they  were  still  with  Roberts  when 
Roberts  called. 

Q    Okay.   The  Conunittees  have  been  told  that  Roberts 
referred  to  IBC  as  something  like  the  "White  House  outside  of 
the  White  House,"  or  a  front  for  the  White  House  on  Nicaragua. 

A    They're  two  very  different  things.   I  mean — 

Q    Were  a  front  for  the  State  Department  on  Nicaragua. 
Can  you  respond  to  those  characterizations? 

A    I  don't  think  I  want  to.   I  mean,  I  never  made 
them.   I  don't  accept  the  characterization. 

Q    Are  you  aware  of  any  reasons  why  Roberts  would  have 
characterized  IBC,  if  in  fact  he  did,  as  the  "White  House 
outside  of  the  White  House"  with  respect  to  Nicaragua? 

A    I  have  no  idea  why  he ' d  do  that . 

Q    Okay.   And  the  same  question  with  respect  to  the 
phrase  a  "front  for  the  White  House  with  respect  to  Nica- 
ragua?" 

A    Well,  I  think  it's  an  affront  of  a  characterization. 
I  don't  agree  with  it. 

Q    But  are  you  aware  of  any  reasons  why  Roberts  would 
have  characterized  IBC  that  way? 

A    No.   The  only  thing  I  would  say  is,  I  think  we  were 
generally  recognized  in  Washington  at  the  time  as  experts  on 
Central  American  policy  for  the  Administration,  and  this  town 


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is  a  very  small  tovm.   People  generally  knew  that  we  were 
working  with  the  Nicaraguan  resistance  also.   So  I  don't 
think  that  there's  anything  mysterious  about  that.   I  would 
think  somebody  who  was  politically  active,  Democrat  or 
Republican,  would  have  known  of  our  interest  and  our  expertise 
in  the  area.   We  had  been  working  with  the  Gulf  and  Caribbean 
Foundation.   We  had  been  working  with  State  Department. 
We  had  been  working  with  the  resistance. 

Q    And  that  might  explain,  also,  the  phrase  "front  for 
the  State  Department",  or,  "as  good  as  the  State  Department" 
with  respect  to  Nicaragua. 

A    In  the  hope  of  not  going  around  in  an  exchange 
again,  I  really  don't  want  to  characterize  it — you  know — it's 
his  phrase.   If  he  said  it,  I  don't  consider  ourselves  a 
front  for  anybody. 

Q    Okay.   What  was  your  initial  business  relationship 
with  Channell  and  Conrad? 

A    Our  initial  business  relationship  started  in  May, 
and  Mr.  Channell,  Mr.  Conrad,  Frank  Gomez  and  myself,  had  a 
dinner  at  which  we  were  offered  a  retainer  of  $15,000  a  month 
which  we  accepted,  and  our  relationship  was  initially  with 
the  American  Conservative  Trust. 

Q    what  was  the  nature  of  the  work  that  you  were  going 
to  perform  for  the  American  Conservative  Trust? 

A    As  I  recall,  initially,  our  responsibility  was  to 

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UNCUSSIFIED 


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educate  Mr.  Channell  and  his  employees  on  the  finer  details 
of  U.S.  foreign  policy  in  Central  American,  and  the  activities 
of  the  Nicaraguan  government,  and  other  democratic  governments 
in  Nicaragua--or  in  Central  America,  rather.   And  to  provide 
informational  materials  to  them  which  could  be  turned  into 
public-education  efforts  on  their  part. 

Q    And  did  you  understand  what  the  purpose  of  this 
education  process  was  to  be,  in  so  far  as  American  Conserva- 
tive Trust  was  concerned? 

A    Yes.   They  intended  to  produce  campaign  materials 
to  influence  Congress,  and  American  public  opinion  on  the 
issue  of  Nicaragua,  in  support  of  the  President's  position. 

Q         When  you  say  "campaign  materials",  are  you  referring 
to  political  campaign  materials? 

A    Yes .   ACT  was  a  federal  PAC . 

Q    And  you  said  the  fees  were  $15,000  a  month.   How 
long  did  this  fee  arrangement  hold? 

A    Not  very  long.   Inside  of  probably — well,  let  me 
see.   By  September,  we  were  involved  in  other  projects, 
particularly  those  for  the  National  Endowment  for  the 
Preservation  of  Liberty,  which  were  huge  undertakings,  and 
our  fees  rose  in  proportion  to  those  undertakings . 

Q  When  did  the  National  Endowment  for  the  Preserva- 
tion of  Liberty,  which  we  can  refer  to  by  the  acronym  NEPL, 
become  the  principal  Channell  entity  with  which  IBC  dealt? 


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A    I'd  say  in  July  of  1985. 

Q    Of  19857 

A     Yes .   • 

Q  Was  there  a  written  agreement  between  IBC  and  the 
American  Conservative  Trust  evidencing  this  fee  arrangement? 

A    The  initial  fee  arrangement,  no.   Subsequently,  we 
had  budgets  for  proposed  programs,  and  I  think  it  was  August, 
I  attempted  to  put  it  down  on  paper  as  for  the  understandings 
between  Channell  and  I,  but  I'm  not  sure  it  was  captured 
there,  either.   It  was  a  very  fluid  arrangement. 

Q    How  are  the  fees  determined? 

A  They  were  budgeted  by  me,  dep>ending  on  the  work  I 
thought  was  required  at  IBC  to  accomplish  what  Channell  was 
asking  be  accomplished. 

Q    We're  now  talking  about  the  fees  beyond  the  $15,000 
initial  retainer? 

A    Even  the  $15,000. 

Q    Okay.   In  doing  your  budgeting,  was  there  a  time 
basis  for  your  fee  allocation? 

A    You  mean  time  and  billing? 

Q    Yes. 

A    No. 

Q    Okay . 

A    We  only  one  time,  we  gave  to  Dan  Conrad  a  time- 
and-billing  analysis  for  a  single  month,  which  indicated 


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their  fees  would  have  been  $72,000  based  on  our  hourly  fees. 

Q    What  were  your  hourly  fees  at  that  time? 

A    Partners  were--I  don't  know.   I  think  the  chart  I 
gave  them  was  $125  an  hour  for  partners,  senior  staff  was  75, 
and  I  think  junior  staff  was  forty.   You  can  see  how  many 
hours  you're  talking  about  at  that  kind  of  level.   I  mean,  it 
doesn't  take  a  lot  of  mathematics  to  see  it  was  a  ridiculous 
workload. 

Q    Is  it  fair  to  say  that  the  basis  for  your  fees, 
then,  was  on  a  transactional  basis?  Work  done? 

A    Precisely,  and  I  would  budget  it,  I  would  tell 
Channell  what  I  thought  it  would  cost  to  do  it,  and  then  we 
would  perform  it  for  that  cost. 

Q    Did  you  provide  re.gular  invoices  to  American 
Conservative  Trust  or  to  NEPL? 

A    Not  until  1986  did  we  really  start  that  as  a 
practice,  and  that  was  at  Dan  Conrad's  requirement. 

Q    All  right.   At  the  time — 

A    There  were  some.   I  think  there  was  one  in  '85,  but 
most  of  them  were  in  1986. 

Q    Did  NEPL  usually  pay  for  work  performed,  or  did 
they  pay  in  advance  for  certain  projects? 

A    They  had  to  pay  in  advance  for  certain  projects 
because  they  were  so  large  that  we  couldn't  afford  to--the 
outlays  to  start  them,  without  mjiASy-Jrom  NEPL. 


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Q    In  addition  to  the  fees,  did  NEPL  also  reimburse 
expenses,  or  did  the  fees  include  an  allocation  for  expenses? 

A    In  the  program  area,  it  required  them  to  pay 
expenses.   For  the  general  retainer,  it  did  not  require 
expenses.   But  for  program  items,  we  did  require  expenses. 

Q    At  the  time  that  you  first  met  Channel!,  did  he  know 
North? 

A    No.   I  should  amend  that.   I  think  there  was  some 
kind  of  a  briefing  that  was  associated  with  the  Nicaraguan 
Refugee  Dinner,  that  I  think  maybe  North  gave  the  briefing. 
You  know,  his  slide  show  to  that  group.   But  I'm  not  positive 
about  that. 

Q    How  did  Channell  eventually  meet  North,  if — I  mean, 
beyond  that  group  briefing?  . 

A    At  a  briefing  that  I  set  up. 

Q    And  you're  referring,  now,  to  the  June  27  briefing? 

A    I  believe  that  was  the  first  one,  yes. 

MR.  KAPLAN:   This  is  a  good  time  for  a  break. 
[Brief  recess. ] 
BY  MR.  KAPLAN: 

Q    Mr.  Miller,  you  testified  earlier  about  a  dinner  in 
early  April  of  1985  attended  by  yourself,  Mr.  Gomez, 
Mr.  Channell,  Mr.  Conrad,  and  Mr.  John  Ramsey  from  Wichita 
Falls,  Texas.   Do  you  recall  who  arranged  that  dinner? 


Mr.  Channell. 


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Q    Did  Channell  tell  you  anything  about  Mr.  Ramsey 
prior  to  the  dinner? 

A    That  he  was  one  of  his  big  contributors,  that — the 
other  thing  I  remember  specifically  is  that  John  doesn't 
believe  in  refugees.   He  feels  that  everybody  should  stand 
and  fight  for  their  own  country.   So  those  are  the  two  things 
I  remember  as  him  saying. 

Q    Did  Channell  tell  you  anything  more  about  Mr. 
Raunsey  in  terms  of  his  personality  or  demeanor? 

A    Just  that  he  was  a  patriotic  individual. 

Q    Did  he  describe  Ramsey  to  you  as  a  tough  cookie  or 
something  to  that  effect? 

A    I  don't  remember  that  specifically,  but  it  was 
clear  that  he  was — with  the  refugee  business,  it  was  clear 
that  he  was  a  pretty  tough  cookie. 

Q    Did  you  know  that  the  discussion  of — that  took 
place  after  dinner  was  taped? 

A    I  may  have  known  it  at  the  time.   I  had  forgotten 
entirely  about  it  until  I  was  shown  a  transcript  of  it  in 
May.   But  after  I  was  shown  a  transcript,  I  recalled  that  we 
had  seen  a  transcript  of  it  and  sent  it  to  Mr.  Conrad  and 
told  him  we  didn't  think  it  was  proper  for  it  to  exist  or  for 
it  to  have  been  done.   So  I  get  from  that  some  sense  that 
maybe  we  were  surprised  that  it  had  been  done . 

Q    So  is  it  your  testimony  that  at  the  time  of  the 

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dinner  itself  you  weren't  aware  that  that  conversation  was 
being  recorded? 

A    I  honestly  can't  give  you  a  definitive  answer  on 
whether  I  was  aware  at  the  time  that  it  was  being  recorded. 
But  I  was  subsequently  aware  that  it  had  been  recorded. 

Q    Do  you  recall  the  dinner? 

A    I  recall  it--I  recalled  it  in  general  terms,  and 
now  after  reading  the  transcript,  I  recall  it  specifically. 

Q    And  do  you  recall  whether  there  was  a  tape  recorder 
on  the  table  during  the  dinner? 

A    Again,  I  don't  have  a  specific  recollection  of 
knowing  at  the  time  that  it  was  being  recorded. 

Q    You  testified  a  moment  ago  that  you  had  an  oppor- 
tunity to  review  the  transcript  at  some  point  in  time  prior 
to  having  reviewed  the  transcript  in  connection  with  your 
testimony  before  these  committees.   Do  you  recall  having 
reviewed  the  transcript  in  1985  some  time,  for  instance? 

A    Yes. 

Q    Can  you  describe  briefly  the  circumstances  of  your 
having  reviewed  that  transcript? 

A    I  have  a  very  small  recollection,  and  that  was  that 
Frank  first  reviewed  it  for  spelling  and  proper — Frank 
Gomez — reviewed  it  for  spelling  and  proper  use  of  names  and  so 
forth  that  had  been  transcribed  by  somebody  who  didn't  know 
what  a  Sandinista  was  or  so  forth.   And  then  as  I  recall. 


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when  it  got  to  me,  I  raised  a  question  about  why  it  had — why- 
it  even  existed  and  why  it  had  been  done.   And  then  it  was 
sent  back  to  Dan  Conrad.   Or  maybe  we — no,  it  must  have  been 
sent  back  to  Dan. 

Q    With  whom  did  you  raise  a  question  about  the 
propriety  of  the  recording? 

A  Frank  and  I  together — a  conversation  between  the 
two  of  us. 

Q    Did  you  ever  express  your  concerns  about  the 
recording  to  either  Channell  or  Conrad? 

A    I'm  sure  we  did. 

Q    Do  you  recall  what  their  response  was? 

A  An  unschooled  reaction  to  our  concern — that  they 
didn't  see  what  the  problem  yas. 

Q    Did  you  send  the  transcript  back  to  Channell  or 
Conrad  with  some  marks  on  it? 

A  I  don't  recall  doing  that,  but  I  subsequently  saw 
transcript  that  had  Frank's  corrections  on  it — of  names  and 
spellings  and  so  forth. 

Q  And  that  refreshed  your  recollection  that  you  in 
fact  probably  did  send  back  a  transcript  with  some  correc- 
tions— additions  or  deletions — on  it. 

A    Right.   Actually,  I  don't  think  there  were  any 
deletions.   I  think  it  was  all  corrections. 

MR.  KAPLAN:   Okay.   I'm  going  to  ask  the  reporter 

luim  Aooirirn 


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Wuhinfioo.  D  C      2O0O2 


jlbl45 


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to  mark  as  Exhibit  10  a  composite  exhibit  which  is  comprised 
of  a  letter  that  we  received  from  your  counsel,  Nussbaum, 
Owen  &  Webster  signed  by  Ron  Precup  dated  June  16,  1987  which 
encloses  the  transcript  of  that  conversation  as — strike 
that--what  it  encloses  is  a  list  indicating  to  the  best  of  the 
indicator's  recollection  who  spoke  which  paragraphs  indicated 
in  the  transcript  of  the  conversation  that  occurred  at  that 
dinner. 

[The  document  referred  to  was 
marked  for  identification  as 
Miller  Deposition  Exhibit  No. 
10.] 
MR.  MILLER:   I  don't  want  to  be  argumentative,  but 
what  I  did  was  at  your  request  I  took  the  transcript,  and  as 
best  I  could  I  tried  to  identify  the  person.   I  will  express 
to  you  the  same  sense  of  tentativeness  about  that  now  that  I 
did  before.   I  did  the  best  I  could  to  make  a  determination  of 
the  speaker. 

BY  MR.  KAPLAN: 
Q    That  was  going  to  be  my  first  question.   Is  the 
list  that  was  put  together  and  attached  to  Mr.  Precup 's 
letter — is  that  all  from  your  recollection? 
A    Yes. 

Q    Did  you — or  to  your  knowledge,  without  disclosing 
any  privileged  communications,  anyone  else--review  the 

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miMK  nrowrma  co..  mc. 

507CStrMt.  NE  2  5 

Vuhinfuxi.  O  C      20002 
(202)  M<-M6« 


jlbl46 


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transcript  in  order  to  create  this  list? 

A    No. 

Q    If  we  can  just  run  through  the  list  that's  attached 
to  the  letter.   The  top  left-hand  column  of  the  first  page 
says  "page",  and  then  underneath  that  the  number  35311 — does 
that  refer  to  pagination  that  is  on  the  attached  transcript 
itself? 

A    Yes. 

Q    Is  the  pagination  that  it  refers  to  listed  on  the 
bottom  right-hand  corner  of  that  transcript  itself? 

A    Yes. 

Q    And  then  the  subsequent  pages  just  relate  to  pages 
of  the  transcript — also  the  bottom  right-hand  corner  numbers. 

A    Yes. 

Q    I  ask  that  because  there's  also  a  date-stamp  number 
in  the  top  right-hand  corner,  and  I  wanted  to  make  sure  that 
the  two  didn't  get  confused. 

A    Okay . 

Q    Now,  on  the  right-hand  column — going  back  to  the 
list  provided  by  your  counsel — it  says  "speaker"  and  then  it 
has  initials  underneath  in  that  column.   Who  does  "RM"  refer 
to? 

A    Myself. 

Q    Who  does  "JR"  refer  to? 

A  John  Ramsey. 


uii 


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Wuhuipon.  DC.    20002 
(202)  i*6-ii6i 


\rt 


Jlbl47 


Q    Who  does  "FG"  refer  to? 

A    Frank  Gomez . 

Q    Who  does  "CRC"  refer  to? 

A    Channell. 

Q    If  you'll  turn  to  page  four  of  the  list  provided  by 
your  counsel,  you'll  see  about  five  up  from  the  bottom  in 
that  "speaker"  column  the  initials  "DC. 

A    That's  Dan  Conrad. 

Q    And  then  if  you'll  turn  to  page  seven  of  that  list 
provided  by  your  counsel.   In  the  same  column--the  "speaker" 
column--you'll  see  the  initials  "RRM".   Who  does  that  refer 
to? 

A    Me. 

Q    So  I  take  it  then  you  referred  to  both  with  the 
initials  "RM"  at  the  beginning  of  the  list  provided,  and  it 
looks  as  if  it's  uniformly  "RRM"  toward  the  end  of  the  list. 

A    Correct . 

Q    Did  there  come  a  time  in  April  of  1985  when  you 
assisted  Mr.  Channell  in  obtaining  a  letter  from  Mr.  Calero 
which  authorized  the  Channell  organizations  to  fundraise  on 
behalf  of  FDN? 

A    Yes. 

MR.  KAPLAN:  I  would  ask  the  reporter  to  mark  as 
Exhibit  11  the  document  which  purports  to  be  a  letter  from 
Mr.  Calero  to  Mr.  Channell  dated  April  10,  1985. 


lEMOi  Acciorn 


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_  I  [The  document  referred  to  was 

2  marked  for  identification  as 

3  Miller  Deposition  Exhibit  No. 

4  11.] 

5  BY  MR.  KAPLAN: 

6  Q    I  ask  you  if  you  have  seen  that  letter  before. 

7  A    Yes . 

8  Q    Is  this  the  letter?  This  letter  was  produced  by 

9  your  counsel  in  response  to  the  committees'  subpoenas.   Is 

10  this  the  letter  that  you  assisted  Mr.  Channell  in  obtaining 

11  from  Mr.  Calero? 

12  A    Yes. 

13  Q    Do  recall  what  the  nature  of  your  assistance  was  in 

14  obtaining  this  letter? 

15  A    I  spoke  to  Mr.  Calero  about  it  and  asked  him  to 

16  provide  a  letter.   Initially  a  copy  of  the  letter  was  given 

17  to  me  by  Mr.  Matamoros,  and  it  was  not  adequate.   And  so  I 

18  asked  for  another  letter,  and  Mr.  Matamoros  or  Mr.  Calero — 

19  I'v«  forgotten  which— asked  me  for  some  copy  items  which  I'd 

20  like  to  have  included  in  it,  and  I  provided  them  to  them. 

21  And  the  letter  was  reproduced  and  sent  to  me. 

22  Q    Do  you  recall  what  was  inadequate  in  the  first 

23  draft  that  was  produced  by  Mr.  Matamoros? 

24  A    The  first  draft  was  a  very  short  contract  for 

■tun  Mvofrmoco^  mc 

j«7csa«t.Ni    25  professional  services  as  opposed  to  an  appeal  for  help.   And 


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WuhiniToo.  D  C     20002 


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that  was  inappropriate  for  Mr.  Channell's  understanding  or  my 
understanding.   And  1  think  it  even  offered  a  percentage,  if 
I  recall  correctly.   And  it  was  clear  from  the  content  of  the 
letter  that  it  had  been  misunderstood.   So  we  asked  for 
something  a  little  more  direct  and  more  consistent  with  what 
Mr.  Channell  wanted  to  do. 

Q    Did  Channell  request  you  to  seek  this  letter  for 
him? 

A    Yes. 

Q    Was  it  your  understanding  that  Channell  wanted  a 
letter  like  this  to  use  in  fundraising  activities? 

A    Yes. 

Q    Was  there  any  understanding,  to  your  knowledge,  as 
to  the  fees  or  compensation  that  Mr.  Channell  would  derive 
from  fundraising  on  behalf  of  the  FDN? 

A    Yes.   That's  precisely  the  reason  why  the  letter 
was  redone.   He  was  not  looking  for  any  compensation  from  the 
FDN  for  fundraising  purposes.   All  he  wanted  was  a  letter 
asking  him  to  help.   And  that's  basically  what  this  is.   It's 
written  a  little  more  flowery  than  just  please  help.   But 
that's  exactly  what  he  wanted — an  appeal  letter  from  Mr. 
Calero  to  him  at  his  organization. 

Q    Was  it  your  understanding  at  the  time  that  Channell 
didn't  intend  to  make  any  money  off  of  fundraising  for  the 
contras? 


ymssiFiEO 


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itujR  nepooTmo  co..  mc. 
507CSu«t.  NE  25 

Waihiofion.  D  C      20002 
(202)  Ui-6i6i 


jlblSO 


UHCLASSIHEO 


150 


A    That's  correct. 

Q    What  was  understanding  as  to  why  Channel 1  wanted  to 
engage  in  fundraising  for  the  contras? 

A    He  was  politically  committed  to  supporting  the 
president.   He  was  politically  and  personally  conunitted  to 
seeking  to  help  the  democratic  resistance  in  Nicaragua. 

Q    On  what  do  you  base  that  understanding?   Or  on  what 
did  you  base  that  understanding  at  the  time? 

A     On  my  conversations  and  the  direction  his  program 
had  taken. 

Q    Was  it  your  understanding  that  Channell  and  his 
organizations  would  deduct  expenses  incurred  from  monies  that 
were  contributed  for  the  contras? 

A    I  can't  tell  you  exactly  when  I  became  aware  of 
that.   Initially  no,  other  than  normal  operating  overhead. 
But  some  time  in  late  '85 — maybe  late  summer,  early  fall  of 
1985  he  told  me  that  they  would  be  deducting — I  believe  it 
was  20  percent — from  the  donations  for  assistance. 

Q    Did  you  have  a  response  to  that? 

A    I  think  I  informed  Colonel  North  about  it.   And  I 
may  have  even  taken  it  upon  myself  to  say  that's  fine 
initially.   Because  anything  was  greater  than  zero. 

Q    Did  North  approve  of  Channell  taking  this  20 
percent,  as  you  recall? 

A    I  don't  think  I  sought  his  approval.   I  just  simply 

IgMnLLUQlOED 


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mm  Rtromwo  co..  mc. 
jercSoCTt,  NE  25 

Wuhininxl.  0  C      20002 


jlblSl 


miBW 


151 


told  him  that  Channell  was  retaining  20  percent  within  his 
organization  of  the  contributions. 

Q    Are  you  clear  about  the  20  percent  figure? 

A    Yes. 

Q    At  least  that's  the  figure  you  recall  Channell 
having  told  you  they  were  going  to  be  taking  from  the 
contributions. 

A    Correct. 

Q    When  did  that  conversation  take  place,  as  best  as 
you  can  recall? 

A    The  only  mental  trigger  I  have  is  a  contribution  by 
Barbara  Newington,  which  I  think  was  in  the  amount  of 
$400,000.   So  whenever  the  first  one  of  those  was.   I  think 
it  was  December.   But  the  initial  Ramsey  contribution  went 
directly  to  the  Nicaraguan  Development  Council.   The  second 
Ramsey  contribution  went  directly  toj 


Q    What  was  the  motivation,  if  you  know,  for  beginning 
to  direct  contributions  into  NEPL,  as  opposed  to  Channell 
soliciting  contributions  from  individuals  and  having  them 
directed  directly  to  contra  organizations? 

A    I  have  to  answer  it  in  different  parts.   From  the 
perspective  of  Colonel  North  and  myself,  the  first  and 
foremost  concern  was  an  insulation  between  the  donor  and  the 
recipient. 


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atSMK  nvomwio  CO..  mc. 
507CSa«t.  NE  25 

Variliii(toii.  O  C      20002 


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152 


From  Channell's  perspective,  the  insulation  was 
important  because  he  didn't  want  to  receive  a  deluge  of 
unsolicited  requests  for  funds.   And  also  from  Channell's 
perspective,  he  did  not  want  his  donors  in  a  position  of 
being  in  direct  contact  with  the  Nicaraguan  resistance 
because  again  they  would  be  then  deluged  by  a  series  of 
requests.   That  seems  standard  operation  in  fundraising. 

Q    And  he  preferred  that  they  be  deluged  with  a  series 
of  requests  from  him  as  opposed  to  some  other  organization? 

A    Well,  without  accepting  the  characterization,  as  I 
understand  it  from  my  observations  of  Mr.  Channel 1  and  his 
fundraising  activities,  people  who  give  those  sums  of  money 
only  like  to  do  it  for  very  specific  programs  or  very 
specific  items.   And  if  you  ±)egin  to  go  to  them  all  the  time 
with  little  nickel-and-dime  needs,  they  quickly  turn  to 
someone  else.   They  like  direct,  coherently  presented 
objectives  which  they  can  fund. 

That's  part  of  the  reason  for  that  insulation  and  I 
suspect  part  of  the  reason  for  Mr.  Channell's  success. 

Q    Do  you  believe  that  between  April  or  May  of  1985 
and  the  conversation  you  had  with  Channell  in  which  he  told 
you  he  was  going  to  begin  to  take  20  percent  from  donations 
that  Channel  in  fact  was  passing  along  all  the  money  that  he 
was  receiving  as  contributions  for  the  cause  of  the  contras? 

A    Either  passing  it  along  or  using  it  for  public 

UU^i  I^ftirirr\ 


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iitj.111  mronma  co..  mc. 

507  C  Strm.  N  E  2  5 

Wuhiniioo.  O  C      20002 

(202)  ytt-^ttt 


iHi^l  ^ 


jlbl53 


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education  efforts,  yes,  since  some  of  the  people  gave  to  both 
things . 

Q    This  is  not  intended  to  sound  quite  as  facetious  as 
I  think  it's  going  to  sound.   Did  you  think  that  Channell  and 
Conrad  were  conducting  all  the  activities  which  they  were 
conducting  raising  funds  for  the  contras  under  the  NEPL 
umbrella  out  of  the  goodness  of  their  heart  for  six  or  seven 
months? 

A     I  thought  their  first  priority  was  assisting  the 
Nicaraguan  resistance  and  that  assistance  took  for  them — 
because  we  had  conversations  about  it — it  took  for  them  two 
forms.   The  first  was  direct  assistance.   And  the  second  was 
the  programs  maintained  by  their  organization  which  was 
designed  to  increase  public  support  for  the  resistance  and,  in 
the  case  of  their  political  organizations,  political  support 
for  the  resistance  here  on  Capitol  Hill. 

So  I  felt  always  that  their  objectives  were  to  help 
the  resistance.   And  I  think — in  full  candor,  I  think  they 
spent  their  money  that  way. 

Q    But  you  don't  have  any  basis  for  that. 

A    I  have  not  seen  anything  to  indicate  otherwise. 

Q    To  your  knowledge,  was  one  of  the  reasons  for 
inserting  NEPL  between  the  donor  and  the  ultimate  recipient 
to  provide  the  donor  with  a  tax  deduction  for  the  contribu- 


tion? 


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Vuhmiton.  DC     20002 
(202)  M«-««66 


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A    In  terms  of  the  public  education  effort,  that  was 
quite  certainly  the  reason  for  it.   Can  we  go  off  the  record 
for  one  second? 

MR.  KAPLAN:   Could  the  reporter  please  read  the  last 
question? 

MR.  MILLER:   I  think  you're  recording  over  the  top 
of  another  answer,  aren't  you?  No?   I'm  sorry. 

So  in  terms  of  the  political  efforts  and  the  public 
education  efforts,  it  was  quite  certainly  one  of  the  reasons 
it  was  done . 

In  terms  of  resistance  assistance,  I'm  not  fully  sure 
what  Mr.  Channell's  motivation  was.   But  I  did  not  consider 
it  at  the  time  as  one  of  the  reasons  for  doing  it. 
BY  MR.  KAPLAN: 
Q    Is  there  a  reason  why  NEPL  was  inserted  between  the 
donors  and  the  ultimate  recipients  in  addition  to  IBC  and  IC, 
Inc.,  to  your  knowledge? 

A    Well,  as  I  previously  stated,  Mr.  Channell  wanted 
that  insulation  for  his  donors .   His  donors  wanted  the 
insulation,  and  he  was  the  one  doing  the  fundraising,  so  it 
was  appropriate  to  agree  to  that . 

Q    Did  you  ever  discuss  with  Mr.  Channell  or--maybe 
more  appropriately — did  Mr.  Channell  ever  discuss  with  you 
that  one  of  the  reasons  why  to  insert  NEPL  into  the  network 
was  because  it  would  be  more  enticing  to  potential  con- 

ME  h^mm 


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tributors  or  prospective  donors  to  be  able  to  offer  a  tax 
deduction  to  them? 

A    Actually,  the  opposite  is  true.   Mr.  Channell  told 
me  one  tiine--and  it  stuck  in  my  memory  quite  explicitly--that 
people  who  gave  these  very  large  sums  of  money  were  uninter- 
ested in  the  tax  ramifications  of  it,  that  they  did  it  for 
reasons  of  personal  conviction.   He  used  to  call  them 
warriors,  and  they — his  statement  to  me  was  that  tax- 
deductible  status  has  nothing  to  do  with  the  way  these  people 
make  their  decisions.   And  I  derived  from  that  the  notion 
that  it  was  unimportant  to  these  people. 

Q    Did  you  believe  him? 

A    Oh,  I  think  it's  borne  itself  out  to  be  true.   I 
think  all  these  people  gave  because  of  their  personal, 
convictions  and  patriotism  and  not  because  of  tax-deductible 
status . 

Q  Would  you  feel  otherwise  if  you  were  told  that  most 
all  of  these  people  who  gave  to  NEPL  during  the  relevant  time 
period  indeed  took  tax  deductions  for  their  contributions? 

A    No,  in  that  you're  saying  all  the  people  who  gave 
to  NEPL.   And  the  point  is  I  don't  think  anybody  has  ever 
challenged  the  tax-deductible  nature  of  the  public  education 
effort.   I  don't  think  the  Internal  Revenue  Service  has 
challenged  it.   So  the  public  education  effort,  which  was 
actually  larger  than  the  assistance  effort,  was  well  within 


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(202IM<-«M« 


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the  confines  of  the  regulations  governing  NEPL. 

So  when  you  say  "all",  no,  I  don't.   I  wouldn't  be 
taken  aback  by  that  at  all. 

Q    What  if  you  were  told  that  several  of  the  persons 
who  gave  money  for  direct  contra  assistance,  according  to 
your  prior  testimony  and  according  to  testimony  of  others 
heard  by  the  conunittees,  took  tax  deductions  for  those 
contributions  ? 

MR.  DUDLEY:   Is  the  question  would  that  change  his 
view  as  to  whether  they  really  cared  about  tax  deductions? 

MR.  KAPLAN:   I  don't  see  what  that's  got  to  do  with 

it. 

MR.  MILLER:   Well,  may  I  answer  the  question, 
because  you  characterized  it-  incorrectly.   He  said  "care". 
What  Channell  said  to  me  was  their  primary  motivation  was  not 
the  tax  deductibility.   It  was  having  a  personal  commitment 
to  a  philosophical  position  or  to  something  that  they  had  a 
personal — I've  forgotten  the  word  I  used — but  anyway,  that's 
different  than  whether  they  ultimately  availed  themselves  of 
the  tax-deductible  status. 

I  think  if  they  thought  they  could,  they'd  be  fools 
not  to.   And  they're  all  very  wealthy  people,  and  they  didn't 
get  wealthy  being  foolish.   So  I  think  probably  they  probably 
decided  to  take  a  tax  deduction  if  they  thought  one  was 
warranted . 


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Wutunfioii.  D  C      200O2 
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MR.  KAPLAN:   I  won't  accept  your  characterization. 
I  know  that  there  are  some  of  mine  that  you  probably  won't 
accept. 

On  May  6th  of  this  year,  did  you  plead  guilty  to  an 
information  charging  you  with  one  count  of  defrauding  the 
United  States  under  18  United  States  Code  Section  371? 

MR.  DUDLEY:   As  his  lawyer,  I  will  object  to  that 
characterization.   It  was  not  a  count  of  defrauding  the 
United  States  government.   It  was  a  count  of  conspiracy  to 
defraud. 

MR.  KAPLAN:   That's  correct.   And  that  is  what  18 
United  States  Code  Section  371  provides.   And  I  apologize  for 
the  mis-statement. 

MR.  MILLER:   That's  correct. 

MR.  KAPLAN:   And  was  it  your  understanding  in  that 
plea  of  guilty  that  the  use  of  NEPL's  tax  exempt  status  was 
wrong  or  was  unlawful  in  connection  with  the  direct  contra 
assistance  effort? 

MR.  MILLER;   As  I  understand  it — 

MR.  DUDLEY:   Let  me  finish  the  question,  and  then 
let  me  talk  before  you  start  answering. 

Have  you  finished  the  question? 

MR.  KAPLAN:   Yes. 

MR.  DUDLEY:   I  object  to  the  point  of  the  question 
on  the  grounds  I  think  that  you're  asking  him  for  some  rather 

iiMm  Aooirirn 


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tricky  legal  conclusions  here.   And  I  have  a  problem  with  the 
breadth  of  it,  because  it  may  well  be  that  not  all  the 
contributions  for  direct  assistance  would  have  been  in  any 
way,  shape,  or  form  wrong.   And  I  don't  want  him  to  answer  a 
question  that's  in  a  very  sensitive  area  like  that  without 
perhaps  some  minor  distinctions  being  observed. 

MR.  KAPLAN:   I  accept  that,  and  I  withdraw  the 
question. 

I'm  not  trying  to  lead  you  into  a  trouble  area. 
You  just  gave  some  testimony,  some  of  which  was  maybe  even  a 
bit  non-responsive  about  the  view  of  the  use  of  NEPL's  tax 
exempt  status  with  respect  to  the  fundraising  efforts  for 
direct  contra  assistance  and  certain  direct  contra  assistance, 
which  we'll  get  into  a  little  later  today. 

And  my  concern  is  that  as  I  listened  to  that  testimony, 
it  didn't  strike  me  as  being  entirely  consistent  with  the 
plea  of  guilty  to  the  information  to  which  we've  just 
referred.  And  I  wouldn't  want  to  have  the  reflect  an 
inconsistency  with  what's  a  matter  of  public  record,  because 
we  are,  after  all,  committees  who  are  creating  a  record  that 
we  want  to  have  consistent  with  what's  known  to  the  public 
and  part  of  a  judicial  record  filed  in  Federal  District  Court 
in  Washington,  D.C. 

If  that  inconsistency  that  I  perceive  can  either  be 
cleared  for  our  record,  then  I'd  like  that  clarification. 


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MR.  MILLER:   Well,  I  can't  attempt  to — 

MR.  DUDLEY:   Let's  go  off  the  record  a  minute. 
Q    Is  it  your  understanding,  Mr.  Miller,  that  NEPL's 
tax  exempt  status  was  never  misused  in  the  solicitation  of 
contributions  for  direct  contra  assistance? 

A    No,  that  is  not  true.   It  is  my  understanding  that 
it  was  misused. 

Q    And  briefly,  could  you  explain  in  what  respects  you 
believe  that  NEPL's  tax  exempt  status  was  misused  in  that 
connection? 

MR.  DUDLEY:  I  have  a  problem  with  this  line  of 
inquiry,  and  I  guess  I  may  as  well  put  the  problem  on  the 
record  because  I  don't  understand  what  relevance  his  under- 
standing as  a  layman  of  the  -legal  issue  with  respect  to  the 
misuse  of  NEPL's  tax  exempt  status.  I  don't  understand  the 
relevance  of  that  to  any  line  of  inquiry  that  the  Committee 
has. 

He  can  tell  you  about  what  in  fact  was  done  and 
what  he  knew  at  the  time  it  was  done.   It  seems  to  me  those 
are  perfectly  relevant  inquiries.   His  understanding  of  the 
legal  concepts  as  we  sit  here  doesn't  seem  to  me  to  be 
relevant  and  quite  frankly  may  entrench  upon  areas  that  I  am 
not  sure  he  is  competent  to  testify  to. 

MR.  KAPLAN:   I  didn't  intend  to  entrench  on  any 
areas  in  which  he  was  competent  to  testify,  and  I  am  certainly 

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Wuluii(nxi.  O  C     20002 
(202)  i*t-(Mt 


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not  asking  Mr.  Miller  to  draw  any  legal  conclusions.   I 
simply  was  seeking  a  response  to  the  question  following  on 
the  prior  answer  of  Mr.  Miller's  as  to  in  what  respects  he 
believed  the  tax  exempt  status  of  NEPL  was  ever  misused  or 
was  misused  in  connection  with  direct  contra  assistance  fund- 
raising  efforts. 

That  certainly  is  an  area  that  is  within  the  focus 
of  both  the  Committee's  mandates.  And  to  the  extent  that  it 
is  going  to  impinge  on  any  attorney/client  communications,  I 
have  no  interest  in  the  answer.  I  am  asking  for  his  under- 
standing. It  really  is  a  follow-up  to  an  answer  that  he  gave 
to  a  previous  question. 

Let's  go  off  the  record  for  a  minute. 

MR.  LEON;   Off  the-  record. 

(Off  the  record.) 

MR.  KAPLAN t   I  am  going  to  ask  for  an  answer  to  my 
pending  question. 

MR.  DUDLEY:   I  am  not  quite  sure  what  is  on  the 
racord  and  what  isn't,  but  I  will  want  my  objection  noted 
that  it  calls  for  legal  conclusions  that  he  is  not  competent 
to  make. 

THE  WITNESS:   As  I  understand  it,  Mr.  Channell 
offered  to  contributors  the  capacity  to  deduct  the  contribu- 
tion for  assistance  to  the  Nicaraguan  resistance,  which  he 
knew  not  to  be  deductible,  and  I  was  a  participant  in  that 

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Vaihiofion.  DC     10002 
(201)  yt6-itU 


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conspiracy. 

BY  MR.  KAPLAN: 

Q    And  did  you  have  contemporaneous  knowledge  at  the 
time  that  these  deductions  were  offered  that  Mr.  Channell  was 
offering  deductions  that  were  not  appropriate  at  the  time? 

A    Not  that  I  can  specifically  point  to. 
[Witness  and  attorney  consult.] 

A    If  I  can  amend  my  previous  answer  — 

Q    Sure . 

A    —  instead  of  the  word  "assistance",  I  think  it 
should  be  "for  the  purchase  of  arms". 

Q    And  do  you  recall  when  you  came  to  the  understanding 
that  this  use  or  misuse  —  this  use  of  NEPL's  tax  exempt 
status  was  indeed  a  misuse  of  that  tax-exempt  status? 

A    I  can't.   It  was  a  growing  understanding,  culminat- 
ing May  6,  1987. 

Q    Okay . 

Did  there  come  a  time  when  NEPL  began  to  give  money 
to  IBC  or  to  IC,  Inc.  that  was  intended  to  be  provided  for 
assistance  to  the  contras? 

A    Yes. 

Q    When  did  that  occur? 

A    It  began  receiving  contributions  from  Mr.  Channell 
in,  I  believe,  July  of  1985. 

Q    And  did  those  contributions  come  from  Mr.  Channell 


\m(^\  Rooinrn 


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as  the  result  of  the  conversation  that  took  place  at  a  dinner 
on  July  9? 

A    I  don't  think  that  is  the  right  date,  but  it  was  in 
July  that  there  was  a  dinner  --  there  was  a  meeting,  not  a 
dinner,  in  the  Hay  Adams  where  Colonel  North  directed  Mr. 
Channel 1  to  send  the  contributions  to  IBC. 

Q    You  have  testified  previously  as  to  the  date  of 
that  meeting,  I  believe.  We  can  amend  that  testimony  to 
insert  a  different  date,  if  that  will  be  useful. 

Do  you  recall  a  date  other  than  July  9th? 
A    I  don't  recall  July  9. 
Q    Okay . 

A    I  don't  recall  another  date  specific. 
Q    Okay. 

A    The  independent  counsel  is  using,  I  believe,  the 
15th,  is  it? 

MR.  DUDLEY:   I  think  July  9th. 
THE  WITNESS:   Oh,  July  9th;  okay. 
MR.  DUDLEY:   I  think  his  problem  wasn't  so  much 
with  the  date  as  with  the  characterization  of  it  as  a  dinner. 
MR.  KAPLAN:   Okay. 
BY  MR.  KAPLAN: 
Q    Well,  at  this  meeting  were  Channell,  Conrad,  North 
and  yourself  in  attendance? 


Yes. 


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Q    And  at  the  meeting  to  which  you  testified  on  June 
23rd  here  with  us.   Is  that  correct? 
A    Yes. 

Q    Do  you  recall  with  any  better  specificity  the  date 
of  the  first  payment  from  NEPL  to  IBC  that  was  related  to 
direct  contra  assistance? 

A    I  don't  recall  specifically  what  — 
Some  time  in  July  of  19857 
It  seems  to  me  that  it  was  in  July  of  1985. 
Do  you  recall  the  amount  on  that  contribution? 
As  I  sit  here,  no,  but  I  am  sure  it  is  in  my 


Q 
A 
Q 
A 
records . 

Q    Okay . 

Did  you  continue  to  receive  payments  for  direct 
contra  assistance  from  NEPL  through  November  of  1986? 
A    Yes. 
Q    Okay . 

And  when  I  say  did  you  continue  to  receive,  I  am 
referring  to  either  IBC  or  IC,  Inc. 
A    Yes. 

MR.  DUDLEY:   What  was  the  date  and  the  question? 
I'm  sorry. 

MR.  KAPLAN:  November  19th. 

BY  MR.  KAPLAN:   How  did  you  segregate  the  payments 
from  NEPL  that  were  intended  for  direct  contra  assistance 


167 


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from  those  payments  from  NEPL  which  you  attributed  to  fees 
owed  for  services  performed  by  IBC? 

A    You  have  the  cart  before  the  horse. 

Q    Yes. 

A    Since  our  primary  responsibilities  were  for 
managing  the  public  education  and  lobbying  efforts,  it  was 
easy  therefore  to  take  those  things  that  were  in  addition  to 
those  required  charges,  and  they  were  easily  identified.   If 
you  look  at  them  the  way  you  have,  then  you  would  be  confused. 
But  if  we  are  in  day-to-day  operation  and  we  are  receiving 
fees  for  television  documentaries,  for  retainer  fees  and  for 
things  of  that  nature,  then  when  we  get  an  additional  amount, 
it  is  either  announced  to  us  or  is  something  which  is  in 
great  excess  of  anything  we  need,  it  is  clear  that  it  is 
assistance  money. 

[Witness  and  attorney  consult.] 
BY  MR.  KAPLAN: 

Q    Based  on  your  conference  with  counsel,  do  you  wish 
to  add  anything  to  your  previous  answer? 

A    No. 

Q    Okay. 

Do  you  recall  the  approximate  amount  of  NEPL 
payments  to  IBC,  that  is  total  payments,  from  July  19  85  to 
November  1986? 

A    It's  in  excess  of  $5  million. 

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(202)  M6-i«66 


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Q  Okay. 

And  do  you  recall  what  the  total  amount  was  that 
was  designated  for  direct  contra  assistance? 

A    I  have  recently  finished  the  computations  on  it, 
and  it  is  53.44  million. 

Q    Okay. 

And  when  you  say  you  recently  finished  computations, 
what  records  have  you  used  in  order  to  do  your  computations? 

A    The  same  ones  you  have,  the  invoices  and  receipts, 
bank  records . 

Q    Okay . 

Who  determined  the  timing  and  amount  of  payments 
from  NEPL  to  IBC  for  contra  assistance? 

A    Mr.  Channell. 

Q    Now  the  difference  between  the  $5  million  total 
payments  you  received  from  NEPL  between  July  1985  and 
November  1986  and  the  payments  that  your  computations  show 
were  used  for  direct  contra  assistance  is  about  $1.56  million 
or  maybe  a  little  more,  I  take  it  just  from  your  testimony 
this  morning. 

Was  that  remaining  eimount  considered  to  be  payment 
by  NEPL  to  IBC  for  fees  for  services  and  any  disbursements 
expended  in  the  performance  of  those  services? 

A    Yes. 

Q    What  services  exactly  gave  rise  to  the,  let's  call 


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it  to  round  it  out,  $1.6  million  of  fees  during  that  15  or 
16 -month  period? 

MR.  DUDLEY:   Fees  and  expenses. 

BY  MR.  KAPLAN: 
Q    Fees  and  expenses. 

A    I  mean,  you  have  asked  for  an  encyclopedia.   In  the 
general  category,  media  relations,  lobbying  activities, 
legislative  analysis,  administration  policy  analysis,  program 
items  such  as  writing  of  text,  creation  of  documents,  and 
research  into  policy  and  implications  of  legislation  on 
policy. 

We  operated  a  speakers '  bureau .   We  produced 
several  films,  television  documentaries.   We  maintained  film 
crews  in  the  border  region 
and  in  some  cases  they  went  into  Nicaragua.  We  maintained 
film  crews  in  Nicaragua  and  Managua. 

We  produced  text  for  ads.   We  produced  news  release 
materials,  statements.   We  produced  graphics.   We  produced 
slides.  We  produced  brochures.  We  produced  books.   We 
produced  briefing  books.   We  set  up  meetings  between  NEPL 
people.  Administration  officials.  Congressional  officials, 
media  people,  state  and  local  officials,  industry  officials, 
private  citizens'  groups. 

We  provided  the  Washington  coordination  for  the  UNO 
leadership's  Washington  activities  in  1986.   We  provided 


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long-term  strategic  planning  documents.   We  provided  scenario 
analyses  of  activities  by  the  resistance  forces.   We  provided 
liaison  with  the  resistance  forces  and  NEPL  officials.   We 
provided  briefings  for  NEPL  contributors.   We  provided  --  I 
don't  know  how  long  you  want  the  list  to  get.   That's  as  much 
as  I  can  remember  right  now. 

We  handled  —  in  the  area  of  Central  America,  we 
handled  the  Central  American  Freedom  Program  and  its  original 
--  its  originator  which  had  a  working  title  of  the  Sacher 
program  and  the  Central  American  Diplomacy  Program.   We 
handled  the  strategic  defense  initiative  program  for  the 
Endowment  and  for  Sentinel.   We  handled  constitutional 
minutes  program  for  the  National  Endowment.   We  handled  a 
South  African  Program  for  th.e  Endowment.   We  handled  a 
terrorism  program  for  the  endowment. 

We  assisted  in  setting  up  one  of  the  political 
action  committees,  and  other  duties  as  a  side. 

Q    Did  you  ever  read  Jerry  Lucas'  memory  book? 

A    NO. 

Q    Very  good  recitation  of  the  services  that  you 
provided  going  back  a  couple  of  years  ago. 

MR.  DUDLEY:   Jerry  Lucas,  as  I  understand  it,  can 
do  the  Cincinnati  phone  book. 
BY  MR.  KAPLAN: 

Q    Were  there  invoices  supporting  the  fees  and 


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(2021  VW-MM 


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expenses'  portion  of  the  NEPL  payment? 

A    For  many  of  the  fees  and  services,  yes,  we  did  have 
invoices . 

Q    Do  you  know  approximately  for  how  many  of  the  fees 
and  services'  portion  was  supported  by  invoices? 

A    I  never  totalled  that  up,  so  I  couldn't  answer. 

Q    Okay. 

When  did  you  start  issuing  invoices  to  NEPL  for 
your  fees  and  services? 

A    I  think  we  started  in  December  of  1985.   It  was  an 
attempt  to  kind  of  get  a  handle  on  things  because  they  had 
been  so  frantic  and  so  all-consuming  in  their  activities  that 
we  were  —  I  was  trying  to  get  a  handle  on  it,  and  so  was  Dan 
Conrad . 

Q    How  much  of  the  $1.6  million  — 

(Brief  discussion  off  the  record.) 
BY-  MR.  KAPLAN: 

Q    I  think  I  had  started  into  a  question.   How  much  of 
the  $1.6  million  was  attributable  to  fees,  and  how  much  was 
attributable  to  expenses,  to  the  best  of  your  recollection? 

A    I  really  have  not  sat  down  and  done  a  division  on 
it. 

Q    We  discussed  a  little  earlier  the  basis  for  your 
fees,  and  I  take  it  that  with  respect  to  this  $1.6  million, 
that  basis  that  you  described  earlier  this  morning  would 


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WuhiiifnMl.  DC.     2000] 
(202)  yt^Mtt 


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apply.   Is  that  correct? 

A    Yes. 

Q     So  that  a  number  of  the  projects  for  which  you 
performed  services  were  charged  to  NEPL  on  the  basis  of  your 
estimation  of  what  appropriate  fees  for  the  project  should  be. 

A    Correct. 

Q    Okay. 

Do  you  have  any  breakdown  as  to  what  percentage  of 
your  fees  related  to  work  performed  for  NEPL  having  to  do 
with  the  contras  or  with  Nicaragua? 

A    No,  I  have  never  done  it  that  way. 

Q    All  right. 

A    I  have  attempted  to  quantify  the  total  during  the 
period  and  have  given  Mr.  Channell  a  report  that  had  a  total 
figure  for  both,  which  was  I  think  about  $1.4  million.   I 
think  that's  right. 

Q    What  would  that  $1.4  million  be? 

A    They  are  really  all  fees  to  IBC  and  all  expenditures 
by  IBC  on  MEPL's  behalf  for  the  programs. 

Q    For  all  programs? 

A    For  all  programs . 

Q    Okay. 

And  can  you  approximate  for  us  approximately  how 
much  of  that  $1.4  or  $1.6  million,  as  we  have  been  talking 
this  morning,  related  to  NEPL  projects  in  connection  with 


JlMCl  h^S.Uli 


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IN.LBI  mromma  co..  mc. 
yn  CSmn.Ni.  25 

Vahuifm.  DC     20002 


Central  America  or  Nicaragua? 

A    I  have  never  done  the  math  on  it,  so  I  really  —  I 
mean,  at  this  point  I  think  it  would  be  almost  impossible  for 
me  to  do  it.   I  would  say  it  is  at  least  half.   That's  about 
as  arbitrary  as  I  can  be.   I  would  say  it  is  at  least  half. 

Q    Okay . 

A    It  was  their  largest  program. 

Q    Okay . 

During  the  period,  how  much  of  IBC's  total  income 
was  attributable  to  NEPL7  And  I  am  still  talking  about  the 
period  from  July  of  1985  through  November  of  1986. 

A    You  want  to  know  how  much  of  IBC's  income  is 
attributable  to  NEPL  in  the  period  between  — 

Q    July  1985  and  November  1986. 

A    I  have  never  quantified  it,  but  I  would  say  it's  at 
least  a  third. 

Q    If  I  told  you  that  on  the  basis  of  records  we  have 
received  from  IBC  and  its  financial  institutions  and  from 
NEPL  and  their  financial  institutions  that  IBC's  total  income 
attributable  to  NEPL  was  84  percent  over  that  time  period, 
would  that  surprise  you? 

A    You  would  have  to  be  including  the  money  that  went 
to  the  assistance. 

Q    That's  right. 

A    Then  that  is  an  erroneous  figure. 

imiAi  Anoinrn 


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Hum  mromwta  co..  hc. 

W  C  Stren.  N  E  25 

Wuhintioo.  DC     lOOOi 


UNCUSSIFiED 


171 


MR.  DUDLEY:   That's  got  nothing  to  do  with  nothing. 

THE  WITNESS:   But  we  can  do  the  math  right  now,  if 
you  want  to.   I  am  not  being  facetious.   You  take  84  percent 
of  $5  million  and  take  away  $3.44  million,  and  that  is  what 
your  percentage  is.   It  would  be  considerably  less  than  80 
percent. 

BY  MR.  KAPLAN: 
Q    Okay.   So  basically,  as  I  understand  it,  NEPL's 
total  income  during  that  period  was  somewhere  in  the  neighbor- 
hood of  about  $6  million. 

MR.  DUDLEY:   You  mean  IBC's. 

BY  MR.  KAPLAN: 
Q    I'm  sorry.   I  stand  corrected.   IBC's  total  income 
during  that  relevant  period  was   --  including  the  direct 
contra  assistance  payments  was  somewhere  very  close  to  $6 
million. 

MR.  DUDLEY:   The  problem  I  have  with  that  is  your 
characterization  of  the  direct  contra  assistance  programs  as 
income  to  IBC,  a  position  that  we  do  not  accept. 

MR.  KAPLAN:   Okay. 

BY  MR.  KAPLAN: 
Q    Then  is  it  fair  to  say  that  under  the  way  you 
calculate  income  that  IBC's  total  income  during  the  relevant 
time  period  was  about  $2.5  million,  that  is  from  July  1985 


through  November  19867 


lim  mimn 


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■USI  RVOHTMO  CO..  HC. 
507CSutn.  NE  25 

Vahioftoo.  DC      20002 
(202)  V4&.46M 


UHKUSSW 


172 


A    Where  are  you  coming  up  with  the  $0.6  million,  that 
is  my  problem?   I  don't  have  my  records  in  front  of  me,  so  I 
can't  tell  you  what  our  total  1985/1986  income  was. 

MR.  OLIVER:   He  subtracted  3.44  from  5  million. 
That's  where  it  comes  from. 

THE  WITNESS:   Yes,  but  it's  apples  and  oranges. 
You  take  the  $5  million  and  subtract  3.44.   Then  what  came  to 
IBC  from  NEPL  was  1.6. 

BY  MR.  KAPLAN: 
Q    And  I  believe  that  the  records  that  have  been 
submitted  to  the  Committees  by  the  various  entities  that  I 
described  a  moment  ago  showed  that  IBC  during  that  time 
period  had  additional  income  of  approximately  $1  million. 
A    Over  and  above  the.  NEPL  income. 
Q    Right;  that  is  right. 

MR.  DUDLEY:   Now  if  that  concords  with  your 
recollection,  tell  him  so.   If  you  have  no  recollection  — 

THE  WITNESS:   I  don't  have  a  recollection  of  a 
specific  figure.   I  have  never  looked  at  it  in  those  terms, 
and  I  would  want  to  before  I  accepted  any  characterization. 
BY  MR.  KAPLAN: 
Q    Have  your  computations  shown  what  IBC's  total 
income  was  for  1985  and  1986? 

A    I  have  never  done  a  total  IBC  income  computation 
for  1985/1986. 


UNCI  mm 


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UNCLASSI 


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mjJR  WKNITWO  CO..  MC. 
)«7  C  Siren.  NE  25 

Wuhuifioii.  D  C     10002 
(202)  M«-66M 


Q    Okay. 

The  computations  that  you  have  done  recently,  were 
they  done  at  someone's  request? 

A    The  Internal  Revenue  Service. 

MR.  KAPLAN:   Okay.   Can  we  go  off  the  record  for  a 
minute? 

MR.  LEON:   Off  the  record. 
[Brief  discussion  off  the  record.] 
BY  MR.  KAPLAN: 
Q    How  were  the  direct  contra  systems  payments  from 
NEPL  to  IBC  treated  by  IBC? 

A    As  client  reimbursable  expenses. 

Q    What  were  they  considered  to  be  reimbursements  for? 
A    You  can't  use  that  as  an  English  language  transla- 
tion.  It's  an  accounting  term  that  has  to  do  with  the  fact 
that  you  were  not  taking  possession  of  the  money.   You  were 
simply  passing  it  on  at  the  behest  of  the  client. 
Q    Okay.   I  appreciate  that. 

Is  the  treatment  of  these  monies  as  client  reimbur- 
sable expenses  a  treatment  that  was  arrived  at  from  consulta- 
tion with  counsel? 

A    Consultation  with  our  accountants. 

MR.  KAPLAN:   Let's  go  off  the  record. 
(Discussion  off  the  record,  and  consultation 
between  witness  and  attornev 


UM(^I  li 


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Hum  nvomiNa  co..  mc. 

507CStK«.  NE  25 

Wuhmftco.  D  C     20002 
(202)  VM-66M 


uNCUssin 


174 


THE  WITNESS:   In  answer  to  your  question,  the 
accounting  treatment  of  the  NEPL  assistance  money  is  something 
that's  under  consideration  at  the  moment  between  counsel  and 
myself.   And  I  don't  have  a  specific  answer  for  you  at  this 
time. 

BY  MR.  KAPLAN: 
Q    At  the  time  that  the  payments  were  made  by  NEPL  to 
IBC  for  contra  assistance,  how  did  you  treat  them?  That  is, 
how  did  IBC  treat  those  payments  for  tax  purposes  and/or  for 
internal  accounting  purposes? 

A    Again  I  think  I  have  to  give  you  the  same  answer, 
from  an  accounting  and  a  tax  standpoint. 

Q    So  they  were  treated  as  client  reimbursable 
expenses? 

MR.  DUDLEY:   Off  the  record. 
(Discussion  off  the  record.) 
MR.  KAPLAN:   Back  on  the  record. 
MR.  DUDLEY:   The  issue  of  the  tax  and  accounting 
treatment  of  payments  received  by  IBC  for  assistance  —  from 
NEPL  for  assistance  to  the  Nicaraguan  resistance.   It  is  a 
matter  that  is  in  a  state  of  flux.   The  payments  were 
initially  characterized  in  1985  on  the  books  of  the  corpora- 
tion as  client  reimbursable  expenses. 

It  is  not  clear  how  they  will  be  characterized 
either  for  tax  purposes  or  actually  in  the  final  books  of  the 


178 


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miXMK  MVOItTINa  CO  .  MC. 
507  CStiCTi.  NE  2  5 

Vuhiniton.  D  C      20002 
(202)  ;46-6M« 


ONCUSSIREO 


175 


corporation  for  1986.   The  tax  returns  for  1986  have  not  yet 
been  filed.   The  company  is  under  extension,  and  the  issues 
are  the  subject  of  intense  current  discussion  between  Mr. 
Miller  and  his  counsel. 

MR.  KAPLAN:   I  appreciate  that  statement. 
One  more  question  on  the  subject  before  we  get  off 
it  entirely. 

BY  MR.  KAPLAN: 

Q    Did  Mr.  Channell  or  Mr.  Conrad  ever  tell  you  how 
these  payments  should  be  treated  on  IBC's  books? 

A    No. 

Q    I  lied.   One  more  question. 

Did  Colonel  North  ever  advise  you  as  to  how  these 
payments  should  be  treated  on  IBC's  books? 

A    No. 

Q    What  did  IBC  do  with  the  contra  assistance  payments 
that  were  received  from  NEPL? 

A    We  put  them  in  the  general  IBC  account,  and  we 
disbursed  them  as  directed  by  Colonel  North. 

Q    How  did  you  know  what  payments  were  to  be  attributed 
for  contra  assistance? 

A    Normally  Mr.  Channell  announced  them  upon  their 
arrival.   In  other  words,  he  would  bring  a  check  and  say  this 
is  assistance  money. 

In  the  cases  when  we  had  to  pick  it  up  or  it  was 

iiiiAi  ihhinrfl  I 


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IHLUII  WPOWIMO  CO.,  MC. 
}«7CSatn.  NE  25 

Waduoina.  DC.    20002 
(2011  »4<  ttt6 


uNWSsra 


176 


sent  over,  again  he  would  do  the  same  thing. 

Q    Who  determined  the  timing  and  amount  of  those 
payments? 

A    Mr.  Channell. 

Q    Channell  did.   All  right. 

Did  North  ever  have  any  input  to  your  knowledge  as 
to  the  timing  and  amount  of  the  contra  assistance  payments? 

A    No. 

Q    That  is  your  knowledge? 

A    The  answer  is  still  no. 

Q    Is  it  possible  that  North  spoke  with  Channell  or 
Conrad  as  to  the  timing  and  amount  of  those  payments  without 
you  knowing? 

A    It's  hypothetical.-  I  guess  it's  possible,  but  I 
have  no  way  of  knowing  whether  that  ever  took  place. 

Q    Okay. 

A    There  was  one  instance  in  which  Colonel  North  asked 
for  a  specific  amount  of  money  prior  to  Mr.  Channell  raising 
money  through  NEPL. 

Q    Would  you  describe  that  instance? 

A    It  happened  in  1985  in  I  believe  June.   And  Colonel 
North  called  me  and  said  we  need  $30,000  desperately  to  the 
people  involved  in  the  southern  front.   And  could  I  find 
somebody  to  give  $30,000? 

He  didn't  designate  anybody  for  me  to  talk  to.   I 

ISAIAI  aAAir-8r-»% 


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■auiii  iwwjwiMU  CO..  Mc 

W;  C  Surar.  N  E.  25 

Wuhaafloa.  DC      20001 
(102)  »6  UM 


miftssra 


177 


called  Mr.  Channell  Immediately  and  asked  him  If  he  could 
make  a  contribution  or  would  one  of  his  people  make  a 
contribution?  And  he  put  me  almost  immediately  in  touch  by 
telephone  with  John  Ramsey.  And  I  explained  the  situation  to 
John  Ramsey,  and  John  Ramsey  wired  a  contribution] 


And  subsequently  I  spoke  to  Mr.  Channell.  He 
suggested  a  thank  you  letter  to  Mr.  Ramsey.   I  contacted 
Colonel  North,  and  he  said  why  don't  you  send  a  telegram  my 
name,  and  I  did  that. 

Q    This  is  the  same  solicitation  that  you  testified 
about  back  on  June  23rd7 

A    Yes .   So  that  would  have  been  the  only  time  where 
he  determined  the  amount  for  us  to  raise. 

That's  the  only  Instance  that's  responsive  to  your 
question. 

MR.  KAPLAN:  While  we're  on  it,  I  an  going  to  ask 
the  reporter  to  mark  as  Memo  12,  Exhibit  12,  a  copy  of  a 
document  which  was  provided  to  us  by  your  counsel,  and  ask 
you  whether  you  can  identify  that  document? 

[Exhibit  No.  12  was  marked  for 
identification. ] 
THE  WITNESS:   Yes.   It's  a  handwritten  note  of  mine 
in  a  spiral  notebook  I  kept. 

BY  MR.  KAPLAN:   ..»-,»k|  iftf^in^H 


«i  OHt 


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■UKK  mroimta  co..  mc. 

V>7  C  Sam.  N  E.  25 

Vnluiitoa.  DC     20002 
(202)  >4«-4«M 


ONCLASSIFIE!) 


178 


Q    Is  No.  2,  which  states  "okay  on  telegram,"  and  then 
has  Mr.  Ramsey's  name  and  address  beneath  that,  along  with 
Mr.  Channell's  name  and  address  beneath  that,  are  they  notes 
of  a  conversation,  the  conversations  with  North  that  you  just 
referred  to  about  sending  telegrams  to  those  people? 

A    This  is  a  list  of  items  which  I  needed  to  ac- 
complish, and  the  double-check  means  that  I  accomplished 
them.   So  that  would  indicate  that  North  okayed  a  telegram  to 
Reunsey  and  to  Carl  Russell  Channell. 

Q    The  telegram  to  Ramsey  has  been  marked  as  a 
previous  exhibit  during  one  of  the  previous  sessions  of  your 
deposition. 

MR.  KAPLAN:   I'm  going  to  ask  the  reporter  as 
Exhibit  13  a  copy  of  the  mailgram  which  purports  to  be  a 
mailgram  from  Colonel  North  to  Mr.  Channell,  the  text  of 
which  reads,  "Thank  you  for  the  help  on  such  short  notice. 
We  all  appreciate  your  heroic  efforts,"  over  Colonel"  North's 
name. 

(Exhibit  No.  13  was  marked  for 
identification. ) 
BY  MR.  KAPLAN: 

Q    Is  that  the  mailgram  that  resulted  pursuant  to  this 
handwritten  note  and  your  conversation  with  Colonel  North? 

A    Yes. 

Q    While  we're  on  that  handwritten  note,  and  that  is 

mini  Aonsrirf^ 


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■Uai  IMPWIIIWI  00..  MC 
M7CS<mi.  N£.  25 

Vuhufua,  O  C     20002 


UNCIASSIHED 


179 


Exhibit  12,  can  you  tell  me,  Mr.  Miller  what  the  first  note 
on  the  page  refers  to  which  reads,  "I  believe  North  consider 
it  done  on  RR  to  Spitz's  letter"? 

A    Spitz  wanted  a  letter  of  appreciation  from  Ronald 
Reagan  for  his  ad  campaign. 

Q    And  was  that  letter  issued  to  Mr.  Channell  to  your 
knowledge? 

A     I  believe  so. 

Q    Okay.   Down  on  No.  3,  where  it  says  "can  see  slide 
show, "  do  you  recall  what  that  note  refers  to? 

A    I'm  sure  it's  Colonel  North's  slide  show,  but  it 
doesn't  have  anybody  else's  reference  to  it,  so  I'm  not  sure 
what  the  meaning  of  it  is. 

Q    Would  this  have  been  a  slide  show  on  Nicaragua? 

A    That's  Colonel  North's  slide  show. 

Q    Was  it  the  same  slide  presentation  that  he  made  at 
the  June  27  briefing? 

A    7es. 

Q    And  that  he  made  on  several  other  occasions? 

A    Yes . 

Q    Was  that  slide  show  largely  comprised  of  slides 
that  had  been  provided  to  Colonel  North  by  you  or  other 
associates  at  IBC,  or  Mr.  Channell  or  other  associates  at 
NEPL? 

A    No.   There  were  some  pictures  in  it  that  were  taken 


183 


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imkh  i«>wimu  co.,  mc 
W?  C  Scim.  N  E.  2  5 

ViAmwi.  O  C.    20ao> 


massra 


180 


by  Frank  Gomez  ^^^^^^^^p^  which  Colonel  North  had  integrated 
into  a  slide  show.   But  all  the  rest  were  official  declas- 
sified photographs. 

Q    Going  back  to  where  we  were  before  we  got  side- 
tracked on  that  Ramsey  solicitation,  what  did  IBC  eventually 
do  with  the  direct  contra  assistance  payments  after  segregat- 
ing them  for  contra  assistance? 

A    We  spent  them  according  to  Colonel  North's  direc- 
tion. 

Q    Did  IBC,  prior  to  spending  them  for  the  most  part, 
send  them  along  to  IC,  Inc.? 

A    Well,  actually,  I  think  the  initial  transfers  went 
to  Lake  Resources.   There  were  transfers  to 
There  was  the  money  spent  on  the  al-Masoudi  misadventure. 
And  ultimately  the  objective  was  to  move  all  the  transactions 
into  a  situation  where  it  was  money  to  IBC  which  was  passed 
immediately  to  IC,  Inc. 

And  the  final  objective  was  to  have  money  passed 
directly  from  those  who  wanted  to  make  contributions  to  IC, 
Inc.   And  we  did  accomplish  that  in  '86. 

Q    In  '86.   Do  you  recall  when  in  '86  you  instructed 
NEPL  to  begin  sending  payments  directly  to  IC,  Inc.? 

A    I'm  not  sure  of  the  specific  date,  but  I  think  it 
started  somewhere  around  September. 

Q    Could  it  have  been  August  of  1986? 


184 


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■nxiM  mKmima  co.,  mc. 

507  C  Strwt.  N  E  2  5 

Wuhinron.  D  C      20002 
1202)  V4«-MM 


uNtussro 


181 


A    Could  have  been  the  end  of  August. 

Q    At  whose  direction  were  these  payments  first  passed 
to  IC,  Inc.,  were  then  sent  directly  to  IC,  Inc.? 

Did  you  tell  Channell  in  August  or  September  of  '86 
to  send  the  contra  assistance  payments  directly  to  IC,  Inc.? 

A    Yes. 

Q    And  did  you  make  the  determination  that  the  prior 
contra  assistance  payments  to  IBC  would  be  passed  to  IC, 
Inc.,  or  was  that  a  determination  made  by  someone  else? 

A    Well,  Colonel  North  directed  that  they  be  sent  to 
IC,  Inc.   The  original  transactions  which  were  disbursed 
directly  out  of  IBC  were  done  so  for  expediency,  not  for  dual 
purposes,  but  simply  because  there  wasn't  time  to  get  it  to 
IC,  Inc.,  and  then  transfer  -it  from  IC,  Inc. 

Q    Did  North  ever  give  you  a  reason  why  he  wanted  the 
monies  transferred  from  IBC  to  IC,  Inc.  before  ultimate 
distribution? 

A    Well,  we  had  several  discussions  about  it,  and  some 
which  I  discussed  earlier  with  you. 

The  need  for  some  insulation,  and  ultimately  to 
provide  some  secrecy  to  the  transactions. 

Q    That  was  something  that  Colonel  North  expressed  to 
you? 

A    Sure.   We  were  both  very  conscious  of  it. 

Q    Then  who  made  the  —  opened  that  determination  to 


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MUCH  nVOKTMO  CO..  INC. 
!07CSti«t.  NE  25 

Wuhmftoa.  D  C     20002 
(202)  V4«-«666 


umnssra 


182 


instruct  NEPL  to  begin  sending  payment  directly  to  IC,  Inc. 
in  August  or  September  of  19867 

A    I  did. 

Q    You  did,  all  right. 

Did  you  discuss  that  decision  with  Colonel  North? 

A    I  don't  recall  whether  I  specifically  discussed  it 


with  him 
Q 
A 


What  prompted  that  decision? 
we  were  no  longer  involved  in  Mr.  Channell's 
general  programs .   And  the  organization  that  we  had  then 
finished  the  charter  change  on  in  the  Grand  Caymans  was 
sufficient  to  handle  the  transactions  without  them  having  to 
go  through  IBC.   There  was  no  reason  any  more  for  them  to  go 
through  IBC. 

Q    Did  you  ever  tell  Channell  that  IC,  Inc.  was  an 
offshore  company? 

A    I'm  sure  I  did. 

Q    Actually  in  August  or  September  of  1986,  the 
company  would  have  been  called  Intel  Cooperation,  Inc.  by 
that  time? 

A    The  first  checks  may  have  actually  been  to  IC,  Inc. 
But  eventually  they  actually  made  their  NEPL  checks  out  to 
Intel  Cooperation. 

Q    All  right.   Do  you  recall  when  you  might  have  told 
Channel  that  IC,  Inc.,  or  Intel  Cooperation  was  an  offshore 


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company? 

A    I'm  sure  the  seune  time  I  told  him  to  make  the 
checks  out  to  that  entity. 

Q    So  that  would  have  been  sometime  in  the  late  summer 
or  early  fall  of  1986? 

A    Yes. 

Q    Do  you  recall,  Mr.  Miller,  whether,  before  that 
time,  you  ever  told  Channell  that  there  was  another  step 
beyond  IBC  in  the  direct  contra  assistance  funding  network 
that  NEPL  and  IBC  were  engaged  in? 

A    I  don't  remember  specifically  telling  him,  but  I 
may  have . 

Q    So  your  best  recollection  is  that  it  wasn't  until 
August  or  September  of  1986  -that  Mr.  Channell  had  an  under- 
standing that  you  and  Mr.  Gomez  maintained  the  offshore 
company  were  direct  contra  assistance  payments,  eventually 
ended  up  before  ultimate  distribution? 

A    Well,  I  can't  agree  with  your  question  because 
you've  assumed  that  he  knew  it  was  Mr.  Gomez  and  myself.   I'm 
not  sure  he  did  know  that . 

Q    What's  your  understanding  of  what  he  knew? 

A    He  knew  that  there  was  an  offshore  organization 
that  was  responsible  for  distributing  these  contributions. 

Q    To  your  recollection,  the  first  time  that  he  became 
aware  of  that  offshore  company  was  in  August  or  September  of 


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1986? 

A    Yes. 

Q    When,  to  your  knowledge,  did  Mr.  Channell  first 
become  aware  that  you  or  Mr.  Gomez  were  associated  with  that 
offshore  company? 

A     Probably  not  until  this  February,  when  I  issued  a 
report  to  him. 

Q  When,  to  your  knowledge,  did  Mr.  Channel!  or  any  of 
his  associates  first  became  aware  that  Colonel  North  had  some 
informal  association  with  this  offshore  company? 

A    I  don't  know  what  you  mean  by  informal  association 
with  the  offshore  company?   I'm  not  sure  he  had  one. 

Q    Let  me  rephrase  the  question. 

When,  to  your  knoviledge,  did  Mr.  Channell  or  Mr. 
Conrad  first  become  aware  that  Colonel  North  was  directing 
the  disbursements  from  IC,  Inc.  or  Intel  Cooperation? 

A    Not  until  February  of  1987.   That's  totally  right. 
MR.  DUDLEY:  I  know,  but  I  just  want  to  point 
something  out. 

The  question  and  answer  are  I  think  potentially 
misleading,  because  I  think  if  you  asked  him  when  did  they 
become  aware  that  Colonel  North  had  a  role  in  directing  the 
expenditure  of  the  funds  that  they  were  contributing,  the 
answer  would  be  different. 

MR.  KAPLAN:   I  will  ask  that  question  since  I  think 


188 


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that's  a  good  one. 

BY  MR.  KAPIAN: 

Q    When,  to  your  knowledge,  did  Channell  or  Conrad 
first  become  aware  that  North  was  directing  the  ultimate 
distribution  of  contra  assistance  funds  that  were  paid  by 
NEPL  to  IBC  or  to  IC,  Inc.? 

A    I  can't  give  you  a  specific  date,  but  I  would  say 
that  throughout  the  fall  and  into  the  winter  of  '85,  '86, 
they  became  increasingly  aware  of  his  role.   And  by  spring  of 
1986  were,  I  think,  aware  that  he  was  coordinating  this 
activity. 

Q    Did  you  ever  tell  him  that  he  was  coordinating  this 
activity? 

A    I  don't  think  I  ever  specifically  told  him  he  was 
coordinating. 

Q    When  you  all  left  the  table  back  in  July  of  '85 
from  the  meeting  in  which  North  suggested  to  Channell  that  he 
begin  sending  contra  assistance  payments  to  IBC,  what  is  your 
impression  of  what  Channell 's  and  Conrad's  understanding  was 
at  that  time? 

A    That  they  were  seeking  Colonel  North's  advice  and 
consent  and  direction  as  to  who  should  receive  the  funds . 
And  they  got  it,  they  got  it,  and  the  answer  was  to  IBC. 

Q    I  take  it  you  understood  that  when  North  directed 
the  funds  to  go  back  to  IBC  that  North  would  be  involved  in 

i!i^<oi  AOOinrn 


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coordinating  the  operation  and  directing  the  ultimate 
distribution  of  the  funds? 

A    Of  course. 

Q    Did  Mr.  Gomez  have  that  Scune  understanding  to  your 
knowledge? 

A    No.   He  wasn't  at  the  meeting. 

Q    But  did  Mr.  Gomez  come  to  that  understanding  at 
some  later  point  in  time? 

A    Yes. 

Q    When  did  Gomez  come  to  that  understanding? 

A    Actually  we  had  that  understanding  prior  to  that 
meeting  because  that  was  the  import  of  the  al-Masoudi 
business  in  April. 

Q    We're  going  to  get  to  the  al-Masoudi  business  but 
probably  not  till  tomorrow. 

MR.  KAPLAN:   I  think  this  is  a  good  time  for  a 
break  for  me. 

[Whereupon,  at  12:45  p.m.,  the  taking  of  the 
deposition  recessed,  to  reconvene  at  1:45  p.m.,  the  same  day. 


ifmim 


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(202)  M6-MM 


AFTERNOON    SESSION 
BY  MR.  KAPLAN: 
Q    Now,  Mr.  Miller,  you  testified  this  morning  that 
approximately  $3.44  million  of  money  was  given  to  IBC  or  to 
IC,  Inc.  by  NEPL  for  the  purposes  of  direct  contra  assistance. 
Who  directed  the  distribution  of  those  funds  beyond  IBC  and 
IC,  Inc.? 

MR.  DUDLEY:   I  don't  want  to  quibble  with  you.   I 
don't  think  he  testified  to  that.   I  think  those  numbers  were 
yours,  and  he  said  he  didn't  have  his  data  in  front  of  him 
and  didn't  dispute  the  numbers. 

THE  WITNESS:   3.44  is  my  number. 
MR.  DUDLEY:   Okay.   Then  I  am  wrong. 
THE  WITNESS:   3.44-  was  distributed  —  was  given  by 
NEPL  by  IBC  to  be  given  to  the  resistance. 
BY  MR.  KAPLAN: 
Q    Okay. 

And  I  take  it  some  of  that  was  also  given  to  IC, 
Inc.  as  well? 
A    Yes. 

Q    Who  directed  the  disbursement  of  that  money  beyond 
IBC  or  IC,  Inc,  as  the  case  may  be? 
A    Colonel  North. 

Q    And  who  determined  the  timing  and  amount  of  those 
disbursements? 


um  h<tmim 


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_   1       A    Colonel  North. 

2  Q    Okay. 

3  And  how  were  those  disbursements  accomplished? 

4  A    Normally  by  wire  transfer.   And  I  sent  instructions 

5  to  either  my  bank  here  or  the  bank  in  the  Cayman  Islands,  or 

6  rather  I  sent  instructions  to  the  managing  directors  who  then 

7  sent  instructions  to  the  bank. 

8  Q    How  did  Colonel  North  know  that  IBC  or  IC,  Inc.  had 

9  some  contra  assistance  money  on  hand  to  be  disbursed? 

10  A    I  would  have  informed  him  when  we  received  it,  and 

11  we  had  for  1985  a  running  balance  sheet,  and  in  1986  we  also 

12  had  a  running  balance  sheet. 

13  MR.  KAPLAN:   I  will  ask  the  reporter  to  mark  as 

14  Deposition  Exhibit  Number  14.  a  copy,  a  composite  exhibit, 

15  which  consists  of  what  purports  to  be  —  the  specifics  are 

16  not  important  for  purposes  of  my  questioning  —  what  purports 

17  to  be  a  telex,  I  believe,  from  IC,  Inc.  to  Mr.  David  Piesing, 

18  and  that  telex  is  dated  June  13,  1986,  and  then  attached  to 

19  it  for  purposes  of  Exhibit  14  is  what  purports  to  be  a  letter 

20  identical  to  the  telex,  both  signed  by  you  and  Mr.  Gomez. 

21  (Whereupon,  Deposition  Exhibit 

22  Number  14  was  marked  for 

23  identification.) 

24  BY   MR.    KAPLAN: 

mUMD  HMOWIWU  CO.,  MC 

M)7cs««.  NE    25       Q    Do  you  recognize  that  telex  and  letter? 

Wutuofna.  D  C     20002 
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A    Yes. 

Q    All  I  wanted  to  ask  about  these,  is  this  letter  and 
telex  representative  of  the  telexes  and  letters  that  you 
would  send  to  the  Cayman  Islands  pursuant  to  Colonel  North's 
instructions  for  distribution  of  money  from  the  IC,  Inc. 
accounts? 

A    Yes. 

Q    would  Colonel  North  typically  give  you  the  name  of 
the  recipient  of  the  funds? 

A  On  some  occasions  he  gave  me  the  name.  At  this 
point,  I  know  pretty  much  all  of  them,  but  at  the  time  he 
gave  me  the  actual  account  and  the  information  associated 
with  it  that  was  necessary  for  me  to  make  the  transfer. 

Q    Okay. 

Was  that  true  in  all  instances  that  he  would  give 
you  either  the  name  of  the  recipient  or  both  the  name  of  the 
recipient  and  the  account  number? 

A    Yes. 

Q    I  am  going  to  run  through  a  list  of  recipients  that 
you  compiled  on  the  basis  of  information  provided  by  a 
variety  of  entities,  including  IBC,  and  ask  you  to  just  tell 
me  what  you  know  about  the  nature  of  the  organization  and  how 
much  money  they  received  through  the  NEPL,  IBC  and  IC,  Inc. 
channelling  of  funds. 

A    I  am  not  always  going  to  be  able  to  recall  the 

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exact  figure  though. 

Q    Okay.   In  any  event,  I  can  give  you  figures,  and 
you  tell  me  whether  that  seems  right. 
Was  there  a  Carlos  Ulvert? 

A    Yes. 

Q    And  was  that  a  recipient  to  whom  money  was  directed 
by  Colonel  North? 

A    Yes.   That  transfer  that  you  are  describing  is  part 
of  the  $100,000  budget  for  the  establishment  of  the  Washington 
Office  of  the  Unified  Nicaraguan  Opposition,  and  Mr.  Ulvert 
was  Executive  Director. 

Q    And  did  Colonel  North  give  you  the  account  informa- 
tion for  the  transfer  of  funds? 

A    No .   He  told  me  to.  work  that  out  with  Robert  Kegan 
at  the  State  Department,  and  Mr.  Kegan  put  me  in  touch  with 
Mr.  Ulvert  and  at  subsequent  meetings  Mr.  Ulvert  gave  me  the 
account  information. 

Q    Okay.   Was  Mr.  Kegan  involved  in  any  other  transfers 
of  funds  from  the  NEPL,  IBC,  IC,  Inc.  network? 

A    Not  that  I  am  aware  of. 

Q    Had  you  known  Mr.  Kegan  before  Colonel  North 
referred  you  to  him? 

A    Yes. 

Q    Did  you  know  him  from  the  time  that  you  had  spent 


at  the  State  Department? 


iiN(iiAf;!;iFiFn 


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ninl91 


UNCLASSIFIED 


_   1       A    Yes. 

2  Q    We  have  got  on  our  records  a  $10,000  payment  to  Mr. 

3  ulvert  directly.   You  mentioned  that  that  was  part  of  a 

4  larger  $100,000  payment.   Where  did  the  other  $90,000  come 

5  from  or  to  whom  was  it  paid? 

6  MR.  DUDLEY:   The  $100,000  budget  is  what  he  said. 

7  THE  WITNESS:   The  actual  dollar  amount  paid  was 

8  $100,244.10.   I  think  that  is  correct.   There  was  $10,000  to 

9  the  account  of  Mr.  Ulvert.   There  was  $11,000  to  an  account 

10  in  Miami.   There  was  — 

11  BY  MR.  KAPLAN: 

12  Q    Wasn't  that  account  in  the  name  of  Denise  Ponce? 

13  A    There  is  more  than  one  account  in  Miami,  but  off 

14  the  top  of  my  head  I  think  that  is  the  one. 

15  Q    Okay. 

16  A    There  was  $15,000  to  a  gentlemen  by  the  name  of 

17  Katyal  who  was  the  landlord  and  the  owner  of  the  building. 

18  Q    Here  in  Washington? 

19  A    Here  in  Washington. 

20  There  was  $55,750  paid  to  a  bank  here  in  Washington, 

21  which  represented  the  balance  at  the  time.   In  addition,  we 

22  paid  out  of  IBC  accounts  $1,500  to  Wynmark  Corporation,  who 

23  were  the  real  estate  agents  who  secured  the  property  for  us, 

24  and  the  balance  of  the  rent  of  $4,500  was  paid  to  Katyal.   In 

muiM  mmrma  co.,  mc. 

MTcsont.NE  25  addition,    we   rented  the   furniture   for  about    $2,544.10.       I 

Wuhminifi.  D  C     20002 


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think  that  is  where  that  comes  from.   And  we  secured  the 
telephones  deposit,  which  we  got  backs. --..  _ 

I  don't  think  I  left  anything  out.   I  think  that 
basically  is  aboutjL  $100,000 . 

Q    The  $55,700  payment-,  was  that  made  to  a  bank  on 
behalf  of  an  entity  or  an  organization  called  Latin  American 
Finance? 

A    I'm  not  sure  that  is  the  name  of  the  entity.   I 
think  that  is  the  bank's  designation  for  its  Latin  American 
section. 

Q    I  see. 

A    So  whatever  the  bank  was  —  it  seems  to  me  it  was 
First  American  Bank  or  something. 

Q    But  the  payment  itself  would  have  gone  to  something 
called  Latin  American  Finance? 

A    Correct. 

Q    And  were  all  those  payments  directed  by  Colonel 
North? 

A    The  $100,000  was  directed  by  Colonel  North  and  he 
instructed  me  to  undertake  the  activity,  and  I  kept  him 
informed  of  the  expenditures . 

Q    Okay. 

A    And  I  got  the  final  approval  for  the  final  expendi- 
ture of  $55,700;  I  got  his  approval  because  that  would  have 
wiped  out  the  account 


UNCUSSIFIED 


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Q  Our  recorda  show  that  Mr.  Calero  and  accounts 
controlled  by  him  were  Alpha  Services,  Inc.  —  received 
approximately  $1,030,000  from  the  IC,  Inc.  account. 

A    That's  correct. 

Q    Is  that  in  Keeping  with  your  records  or  close  to  it? 

A    Yes. 

I  think  his  total  figure  is  51,230,000. 

Q         Were  those  disbursements  also  directed  by  Colonel 
North? 

A    Yes. 

Q    Were  they  directed  to  accounts  identified  to  you  by 
number  by  Colonel  North? 

A    Yes . 

Q    The  computation  w»  have  done  shows  approximately 
$31,000  were  distributed  to^^^^^^H  Is  that  reasonably 
consistent  with  your  recollection? 

A    NO,  actually  it  is  $41,000.   There  was  a  $10,000 
wire  transfer  from  the  National  Bank  of  Washington  communica- 
tions account  for  a  total  of,  I  believe,  $41,000. 


Q 

A 

Q 

North? 

A 

Q 


Right.   And  31  would  have  come  from  IC,  Inc.? 

Correct. 

were  both  of  those  transfers  directed  by  Colonel 


Yes. 


And  were   tli^y'directed'tjorjaccounts  by  number  by 

liu......-,:l:ir 


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Colonel  North? 

A    Yes. 

Q 
$125,000 

A 

Q 

A 


Friends  of  America  we  show  received  approximately 


That's  correct. 

What  can  you  tell  us  about  Friends  of  America? 

Friends  of  the  Americas  is  a  humanitarian  organiza- 
tion operated  by  Woody  and  Diane  Jenkins  from  Louisiana.   It 
provides  medical  care  and  feeding  facilities  for  Meskito 
Indians  and  Nicaraguan  refugees 


Q    How  did  you  arrive  at  that  understanding  as  to  what 
Friends  of  the  Americas  was? 

A    I  have  known  about-  Friends  for  four  years . 

Q    Did  Colonel  North  direct  the  funds  from  IC,  Inc.  to 
Friends  of  America? 

A  ^  Yes . 

Q    And  did  he  provide  you  with  bank  account  information 
allowing  you  to  direct  those  funds? 

A    Yes. 

Q    Okay . 

Gulf? and  Caribbean  Foundation  received  from  IC, 
Inc.  $21,182. 

A    Correct . 

Q    And  th^  is  former  Congressman  Kuykendall's 


isimi  anf^inrn 


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organization. 

A    That ' s  correct . 

Q    And  did  Colonel  North  direct  the  funds  to  be  sent 
to  Gulf  and  Caribbean  Foundation? 

A    Well,  in  an  indirect  way. 

Q    All  right.   Can  you  tell  us  what  you  mean  by  that? 

A    I  was  contacted  by  Colonel  North  and  asked  to  find 
an  organization  who  would  be  willing  to  serve  as  the  guarantor 
of  surgical  procedures.   In  fact,  I  think  he  characterized  it 
as  reconstructive  surgery.   And  I  agreed  to  do  so.   I  called 
Dan  Kuykendall  and  asked  him  if  the  Gulf  and  Caribbean 
Foundation  would  be  willing  to  be  the  guarantor  for  the 
surgery  through  a  group  of  Miami  doctors.   He  checked  with 
his  Board  and  came  back  and  .said  that  they  would  be  willing 
to  do  that .   And  we  agreed  that  he  would  give  me  the  name  and 
address.   I  gave  the  name  and  address  to  Fawn  Hall,  and  the 
hospital  or  doctors'  organization  sent  the  bills  to  Gulf  and 
Caribbean  when  they  arrived.   And  they  arrived  on  two 
different  occasions. 

We  sent  checks  from  IC,  Inc.  to  the  Gulf  and 
Caribbean  Foundation  so  that  they  could  pay  the  bills.   And  I 
believe  that  they  charged  a  1  or  2  percent  overhead  to  take 
care  of  the  accounting  and  the  check  writing. 

Q  Our  compilation  shows  that  the  Institute  for 

Terrorism  and  Sub-National  Conflict  received  $75,000  from  IC, 


iiiiAi  Roosncn 


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HUSi  iwroirnNO  CO..  mc 
V)7  C  SotCT,  N  E.  25 

Vuhinfioa.  D  C.    }00a3 
(202)  y*t-<i6U 


UNCUSSIREI 


196 


Inc. 


A    That's  correct. 

Q    Did  Colonel  North  direct  that  disbursement  as  well? 

A    Yes. 

Q    And  was  the  disbursement  made  to  an  account 
identified  by  number  by  Colonel  North? 

A    Yes. 

Q    Can  you  tell  us  what  you  know,  if  anything,  about 
the  Institute  for  Terrorism  and  Sub-National  Conflict? 

A    It's  a  foundation  in  Washington  run  by  Neal 
Livingston,  and  at  the  time  of  the  transfer  Rob  Owen  was 
employed  by  them.   And  their  principal  focus  is  on  sub- 
terrorism  and  sub-national  conflicts,  and  Nicaragua  is  a  sub- 
national  conflict. 

Q    Did  you  come  to  any  understanding  as  to  how  those 
funds  were  used? 

A    The  only  understanding  that  I  have  is  that  in  some 
way  it  related  to  Rob  Owen's  being  there.   What  the  specifics 
were  I  wasn't  told. 

Q    Okay . 

Our  records  show  that  approximately  $1.3  million 
was  sent  to  Lake  Resources  from  the  IC,  Inc.  account  and 
apparently  $4  30,000  was  sent  to  Lake  Resources  from  IBC 
directly. 

A    That's  correct. 


UNCUS 


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iMXDi  nrooTmo  co..  inc. 
)07  C  Sutn.  N  E  25 

Wiihin(to<>.  D  C      20002 
(202)  M6-M66 


UNCUiSSI 


197 


Q    Were  those  disbursements,  because  there  were 
several,  directed  by  Colonel  North? 

A    Yes. 

Q    And  were  they,  directed  to  accounts  that  were 
identified  to  you  by  number  by  Colonel  North? 

A    Yes. 

Q    Did  you  contemporaneously  with  those  disbursements 
have  any  understanding  as  to  what  the  purpose,  what  the 
function  of  Lake  Resources  was? 

A    Well,  my  original  understanding  was  that  it  was  an 
organization  for  the  benefit  of  the  Nicaraguan  resistance.   I 
never  heard  of  Mr.  Hakim  until  his  name  surfaced  in  regards 
to  this  inquiry,  and  the  only  thing  I  had  seen  about  General 
Secord  was  the  news  report  £ibout  him  buying  an  airplane 
somewhere  down  south,  in  the  southern  part  of  the  United 
States . 

And  in  regards  to  what  we  were  raising  money  for, 
we  had  some  idea  each  time  we  spoke  to  contributors  about  the 
specific  items  that  we  were  raising  money  for.   So  we  had 
some  understanding  that  the  money  transferred  there  was  to 
pay  for  those  specific  items. 

Q    And  you  are  talking  about  specific  lethal  items. 

A    Both  lethal  and  non-lethal. 

Q    Okay. 

But  I  take  it  that  you  came  to  an  understanding 


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mjua  KcroimNa  co .  mc. 

507  C  Street.  N  E  25 

Washiiition.  0  C      20002 
(202)  ;4«-6«6« 


ONCLASSIF 


198 


that  when  there  were  solicitations  intended  for  the  purchase 
of  lethal  supplies  that  took  place,  that  the  money  that  was 
contributed  in  response  to  those  solicitations  usually  ended 
up  in  Lake  Resources  ultimately. 

A    I  don't  think  I  ever  made  the  connection  between 
those  two  things . 

Q     Okay. 

Latin  American  Strategic  Studies  Institute  received 
some  $50,000.   Is  that  correct? 

A    It  sounds  right. 

Q    And  did  it  also  receive.  $25, 000  directly  from  IBC? 

A    It  did.   That  was  part  of  the  Central  American 
Freedom  Program. 

Q    So  a  total  of  $75,-000  and  all  went  to  Latin 
American  Strategic  Studies  Institute? 

A    Correct. 

Q    Were  those  disbursements  directed  by  Colonel  North 
as  well? 

A    Yes. 

Q    All  $75,000  worth? 

A    Yes. 

The  $25,000  was  for  a  briefing  book  on  Nicaragua, 
and  Colonel  North  asked  that  it  be  funded  and  Adolfo  Calero 
asked  that  it  be  funded.   And  we  funded  it  out  of  the 
resistance  money. 


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■Muni  nvoKTwa  co.,  mc. 

507  C  Sereit.  N  E  25 

Wuhiaitoo.  O  C      20002 


DNKilSSK 


199 


Q    And  I  take  it  that  the  transfer  was  made  to  an 
account  identified  by  number  by  Colonel  North? 

A    Correct. 

Q    What's  your  understanding  as  to  the  nature  of  the 
activities  conducted  by  the  Latin  American  Strategic  Studies 
Institute  with  those  funds? 

A    My  understanding  is  that  it  was  used  for  public 
education  and  I  have  a  letter  from  them,  but  I  can't  recall 
what  the  specifics  of  it  are,  but  public  education. 

Q    How  did  you  reach  that  understanding? 

A    I  asked  for  a  letter  in  response  to  a  need  to  know 
what  they  spent  the  money  on. 

Q    Was  Father  Dowling  an  acquaintance  of  yours? 

A    Yes.   I  knew  Father  Dowling  for  about  the  same 
period  of  time  that  I  knew  Spitz  Channell.  , 

Q    Did  you  know  that  Father  Dowling  was  one  of  the 
principals  in  the  Latin  American  Strategic  Studies  Institute? 

A    I  did. 

MR.  LEON:   You  did  or  did  not? 
THE  WITNESS:   I  did. 
BY  MR.  KAPLAN: 

Q    A  couple  more  questions  about  the  $55,700  that  went 
to  this  Latin  American  Finance.   Were  you  told  what  the  use 
of  those  funds  would  be  at  the  time  that  the  disbursement  was 
directed  by  Colonel  North? 


UNCI  mm 


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MUSI  IWyOWTWQ  CO..  MC. 
507  C  Sottt,  N  E  2  5 

Ttduoftoii.  0  C      20002 
12021  ^*6-iiU 


wsM 


f\ 


200 


A    Yes.   They  were  for  the  administration  of  the  UNO 
office  in  Washington  salaries. 

MR.  LEON:   Would  you  say  that  name  again? 
THE  WITNESS:   UNO  Office  in. Washington. 
They  were  for  the  administration  expenses  and 
salaries  associated  with  the  UNO  Office  in  Washington. 
BY  MR.  KAPLAN: 
Q    Just  to  clarify  the  record,  my  understanding  of 
your  testimony  is  that  Latin  American  Finance  was  a  section 
of  the  bank  to  which  the  payment  was  made  for  this  purpose  so 
that  the  disbursement  would  read  as  a  disbursement  to 
something  called  Latin  American  Finance.   Is  that  correct? 

A    I  don't  know.   My  recollection  is=  that  Latin 
American  Finance  has  more  to  do  with  the  bank  itself  than  it 
does  the  recipient.   The  recipient  was  whatever  the  account 
was  for  the  resistance  organizations. 

Q    Were  you  given  an  account  number  for  that  disburse- 
ment as  with  the  others? 

A    I  was  given  an  account  for  that  disbursement  by 
Carlos  Ulvert. 
Q    Okay. 

What  role  did  Mr.  Kegan  at  the  State  Department 
play  in  the  coordination  of  the  disbursement  of  this  $100,000 
plus  a  little  to  coordinate  or  pay  expenses  and  salaries  for 


the  local  UNO  office? 


\m  hmm 


204 


iNCLASSIFIED 


201 


_   1       A    Well,  Colonel  North  called  me  on  the  telephone  and 

2  told  me  to  get  the  Washington  office  operational  and  that  my 

3  contact  in  doing  that  would  be  Bob  Kegan  at  the  State 

4  Department.   And  I  called  Bob  Kegan  and  told  him  of  the 

5  conversation  and  suggested  that  I  should  meet  with  Carlos 

6  Ulvert,  the  new  Executive  Director.   Mr.  Kegan  arranged  the 

7  meeting.   I  asked  Mr.  Ulvert  for  a  budget.   He  provided  a 

8  budget,  and  I  went  to  Colonel  North  and  discussed  the  total 

9  figure  with  him,  and  subsequently  got  his  approval  to  fund  it. 

10  Q    Do  you  recall  when  these  conversations  took  place? 

11  A    It  seems  to  me  it  was  about  March.  It's  just  about 

12  the  same  time  as  the  first  transfer  to  Katyal. 

13  Q    I  take  it  that  would  be  reflected  on  the  records 

14  that  you  have  provided  us.  - 

15  A    Yes,  within  30  days  of  that  period,  30  days  prior 

16  to  that  period. 

17  Q    So  there  wasn't  a  long  lead  time  from  the  time  of 

18  those  conversations  to  the  actual  payment,  the  coordination 

19  of  those  payments? 

20  A    Ollie  North  had  no  long  lead  times.  ,  It  was  done  — 

21  it  was  one  of  those  things  that  was  required  to  be  done 

22  immediately. 

23  Q    Could  it  have  occurred  some  time  within  a  month  or 

24  so  of  July  30,  1986? 

wlleu  NvoimHo  CO.,  mc. 

M7csar«NE    25       A    Whatever  the  Katyal  transfer  date  was,  it  is  liable 

itn!  °"  iiiim  Aooirirn 


205 


>07  C  Sam.  N  E 
Wuhmfna.  DC     20002 


ifit 


202 


to  be  about  a  week  or  two  prior  to  that. 

Q    Now  the  records  we  have  show  that  there  is  really  a 
couple  months'  period  between  the  Katyal  payment  and  the 
Latin  American  Finance  payment. 

A    Oh,  yes.   Latin  American  Finance  was  the  end  of  the 
grant  process. 

Q    I  see. 

A    Basically,  we  were  turning  over  to  them  the  funds 
to  administer  the  office  themselves. 

Q    So  you  had  the  conversations  with  Kegan  and  Kegan 
referred  you  to  Ulvert,  and  then  you  started  making  payments 
to  control  the  support  purpose. 

A    Correct. 

Q    And  one  of  the  first  payments  was  to  Katyal,  and 
one  of  the  last  payments  was  to  this  Latin  American  Finance. 

A    Latin  American  Finance  was  the  last  payment. 

Q    Okay . 

Do  you  recall  a  $10,000  disbursement  from  IC,  Inc. 
to  the  Nicaraguan  Business  Council? 

A    Yes. 

Q    Did  Colonel  North  direct  that  payment? 

A    Colonel  North  approved  that  payment. 

Q  Okay.  And  when  you  say  —  I  noticed  that  you 
changed  my  wording  to  "approved"  in  this  case.  Can  you 
explain  to  me  — 


irity 


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luuMK  mroimta  co .  inc. 
M7CScit«.  NE  25 

Wuhmttoa.  O  C     2000! 
(2021  m-«666 


A    Yes.   Mr.  Matamoros  approached  me  and  said  that  the 
Nicaraguan  resistance  wanted  to  bring  a  group  of  Central 
American  Congressmen  to  the  United  States  to  be  before 
national  media  and  to  meet  with  officials  in  Washington,  and 
that  it  would  cost  $10,000.   And  he  asked  if  I  could  give  him 
$10,000.   I  called  Colonel  North,  asked  his  permission,  and 
he  said  yes,  and  I  sent  him  $10,000. 

Q    I  take  it  the  Nicaraguan  Business  Council  is 
different  from  the  Nicaraguan  Development  Council? 

A    That's  correct. 

Q    The  Nicaraguan  Development  Council  received  our 
records  show  a  $31,000  payment  directly  from  IBC.   Is  that 
correct? 

A    Actually,  there  were  two  payments,  one  of  $6,000 
and  one  of  $25,000. 

Q    All  right,  combined. 

Here  those  payments  to  the  Nicaraguan  Development 
Council  directed  by  Colonel  North? 

A    Yes . 

Q    They  were.   Again,  were  they  directed  to  accounts 
identified  by  account  number  by  Colonel  North? 

A    In  those  two  instances,  each  of  them  is  slightly 
different.   The   $6,000  was  for  travel  expenses  associated 
with  several  of  the  UNO  leaders  coming  to  Washington, 
expenses  that  the  NBC  had  absorbed,  and  I  was  approached  by 

iiiiAi  innirirn 


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)07CS<Rn.  NE.  25 

Wtdunftos.  DC     20aO> 


Mr.  Metamoros  to  pay  those  expenses,  and  I  got  Colonel 
North's  permission  to  do  so. 

In  the  case  of  the  $25,000,  that  was  $25,000  urgently 
needed,  again,  by  Mr.  Metamoros  for  payroll  taxes,  and 
attorney's  fees,  and  general  operating  expenses  for  the  NDC 
office.   And  he  approached  me  on  it,  and  I  contacted  Colonel 
North,  and  Colonel  North  approved  the  expenditure. 

Q    What  can  you  tell  us  about  the  Nicaraguan  Develop- 
ment Council? 

A    The  Nicaraguan  Development  Council  is  an  organiza 
tion  in  Washington,  tax-exempt  but  I  don't  think  tax-deduc- 
tible.  It  is  a  organization  that  basically  serves  as  the 
domestic  arm  of  the  Nicaraguan  resistance.   One  of  the 
domestic  arms  of  the  Nicaraguan  resistance. 

Q    Similarly,  what  can  you  tell  us  about  the  Nicaraguan 
Business  Council? 

A    I  really  know  nothing  about  the  Nicaraguan  Business 
Council.   Just  that  they  were  the  sponsors  of  this  group  of 
Congressmen. 

Q    All  right.   Do  you  recall  a  $60,000  disbursement 
from  IC,  Inc.  to  an  entity  called  Pigfield  Enterprises? 

A    Pigfield  Enterprises? 

Q    Right. 

A    No.   Would  there  be  another  name  associated  with  it? 
MR.  DUDLEY:   Parkfield  Enterprises? 

iiiinii  jiniiirirn 


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itkxjat  Rvomato  co..  mc. 

)07CScren.  NE  25 

Vuhmfna.  DC     20002 


THE  WITNESS:   Where?  What  country  was  it  disbursed 


to? 


MR.  KAPLAN:   I  believe  it  was  disbursed — can  we  go 
off  the  record  for  a  second. 

[Brief  discussion  off  the  record.] 
MR.  KAPLAN:   Back  on  the  record. 

THE  WITNESS:   Are  you  talking  about  a  $40,000  and  a 
$20,000  transfer? 

MR.  KAPLAN:   I  believe  that's  correct. 
THE  WITNESS:   One  right  after  the  other? 
MR.  KAPLAN:   And  it's  to  a  financial  institution  in 
Florida. 

THE  WITNESS:   Yes.   I  recall  that. 
BY  MR.  KAPLAN: 
Q    Were  those  disbursements  directed  by  Colonel  North? 
A    Yes . 

Q    Were  they  to  account  numbers  provided  to  you  by 
Colonel  North? 
A    Yes. 

Q    And  what  can  you  tell  us  about  those  disbursements, 
if  not  about  Pigfield,  or  Parkfield  Enterprises  itself? 

A    At  the  time  that  those  transfers  were  accomplished. 
Colonel  North  told  me  that  they  were  to  assist  the  church  in 
Nicaragua  to  recover  from  the  harassment  that  they  had 
suffered  at  the  hands  of  the  Sandinista  government,  including 


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(2021  ^46■M«6 


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the  smashing  of  the  presses  and  the  confiscation  of  printing 
materials.   And  also,  operation  of  the  church  organization 
which  had  been  greatly  curtailed.   There  have  been  subsequent 
revelations  that  that  account  is  associated  with  Cardinal 
Obando  y  Bravo,  but  I  have  no  way  to  independently  verify 
that. 

Q    What  about  Polca,  S.A.?   Do  you  recall  a  $25,000 
distribution  to  a  recipient  named  Polca,  P-o-l-c-a-,  S.A.? 

A    Yes. 

Q    Was  that  a  disbursement  that  was  directed  by 
Colonel  North? 

A     Yes. 

Q    Was  it  to  an  account  identified  by  number  by 
Colonel  North? 


Yes. 


What  can  you  tell   us,    if  anything,    eUDout  Polca, 


S.A.  7 


.A    I  don't  have  any  idea  who  it  is. 

Q    Okay.   Do  you  recall  when  that  distribution  was 
made,  offhand? 

A    Late  in  1986. 

Q    Late  1986.   Was  it  some  time  prior  to  Colonel 
North's  having  left  the  NSC? 

A    It  was  given  to  me  prior  to  Colonel  North  leaving 
the  NSC.   I  don't  know  whether  I  accomplished  it  prior  to  his 


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M7CStratt.  NE  2  5 

Wuhmfioa.  D  C      :0002 
(Ml)  VM-MM 


leaving   the  NSC 

Q  Okay. 

A    Because  there's  a  great  lag  time  between  the  time 
he  would  pass  instructions  and  the  time  they  would  be 
executed  by  the  managing  partners  in  the  Caymans.   It's  part 
of  the  problem  of  doing  business — 

Q    I  see.   What  kind  of  lag  time  would  there  be 
between  the  time  that  Colonel  North  gave  you  instructions, 
and  the  time  that  you  sent  a  Telex,  and  letter,  as  marked  as 
an  exhibit  earlier  today,  to  the  Cayman  Islands? 

A    It  really  varied.   It  depended  on  his  expression  of 
urgency.   In  some  cases,  the  transactions  were  continuing, 
such  as  $5,000  a  month,  or  $7,000  a  month,  or  10,000  once  a 
month  for  the  next  three  months,  or  something  to  that  effect. 

Q    But  generally  speaking,  when  Colonel  North  gave  you 
instructions,  you  implemented  them  fairly  promptly? 

A    As  quickly  as  I  could,  yes. 
.  Q    Do  you  recall  disbursements  totalling  $60,000  to  a 
group  called  Friends  of  Freedom,  directly  from  IBC? 

A    Friends  of  Freedom? 

Q    Right. 

A    No. 

Q    What  about  the  same  amount  then,  $60,000,  to 
Alfonso  Robelo? 

A     Yes. 


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Wuhufioa.  DC     KOOl 
(W)  jtittM 


UHCLftSSiF 


208 


Q    And  did  Colonel  North  direct  those  disbursements? 
A    Yes. 

Q    Again,  did  he  direct  them  to  account  numbers  that 
were  identified  by  him? 
A    Yes. 

Q    What's  your  understanding  as  to  the  uce  of  that 
$60,000? 

A    That  money  was  to  support  Mr.  Robelo's  political 
organization^^HUHHHj  pay  his  employees'  salaries,  and 
newsletter  cost,  and  travel  expenses,  administrative  overhead 

Q    Was  the  contribution  that  you  described  earlier, 
pursuant  to  the  solicitation  requested  by  Colonel  North  to 
^^  also  intended  for  Robelo's  behalf? 
A    Yes . 

Q    IBC  also  distributed  a  total  of  $100,000  to  an 
individual  named  Gary  Bagdasarian.   Is  that  correct? 
A    Yes . 

Who  is  Gary  Bagdasarian? 
He's  an  attorney  for  Ibrahim  al-Masoudi. 
And  where  is  he  located? 
California.   Fresno. 

In  Fresno.   Was  that  part  of  your  undertaking  with 
al-Masoudi,  that  you  would  pay  his  attorney's  fees? 

A    Well,  it  was  one  of  the  expenditures  that  we  paid 
on  behalf  of  al-Masoudi. 


-Q 
A 

Q 
A 
Q 


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ll«J.B<  nPOflTMO  CO..  MC. 
107  C  imn.  N  E  2  5 

Waihiofioa.  D  C      20O02 
U021  M«-««66 


UNCLASSIFIED 


209 


Q    Did  Mr.  Bagdasarian  represent  al-Masoudi  in 
connection  with  the  criminal  charges  that  were  eventually 
filed  against  him? 

A    I  don't  believe  so. 

MR.  DUDLEY:   PD  in  Philadelphia. 

MR.  KAPIiAM:   So  the  record's  clear,  PD  is  a  Public 
Defender. 

[Brief  recess. ] 

MR.  KAPLAN:   Back  on  the  record. 

MR.  DUDLEY:   Before  we  b^n^,  there  is  one  thing 
Mr.  Miller  wanted  to  clarify. 

THE  WITNESS:   I  think  you  left  the  impression  that 
the  money  for  Bagdasarian  was  for  fees  for  Bagdasarian.   It 
apparently  was  not.   In  fact-  it  was  represented  to  us  at  the 
time  that  that's  what  it  was  for.   It  was  for  something 
entirely  different. 

BY  MR.  KAPLAN: 
-  Q    Do,  you  know  what  it  was  used  for? 

A    It  was  used  for  a  forfeited  performance  bond  that 
al-Masoudi  supposedly  had  to  forfeit.   It  was  104,000,  total. 

MR.  DUDLEY:   And  what  it  was  actually  used  for-- 

MR.  KAPLAN:   Was  Bagdasarian  the  guarantor  on  the 
performance  bond?   Is  that  what  your  understanding  was? 

THE  WITNESS:   No,  no.   It  was  al-Masoudi 's  perfor- 
mance bond.   Bagdasarian  was  simply  serving,  I  think,  as  a 

iiAiAi  lOAinrn 


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WiriunftoB.  DC     20002 
(201)  VM-44M 


conduit. 


UNCLA 


210 


BY   MR.    KAPLAN: 

Q    What  was  the  performance  for?   Do  you  know? 

A     I  don't. 

Q    What  was  the  source  of  the  $100,000  that  was  paid 
to  Mr.  Bagdasarian? 

A    That  was  assistance  money. 

Q    Did  Colonel  North  direct  that  $100,000  disbursement? 

A    Yes.   He  approved  that  $100,000  disbursement. 

Q    He  approved  it.   So  that  I  take  it,  then,  you  were 
asked  to  make  good  on  a  $100,000  performance  bond  that  al- 
Masoudi  forfeited  on,  and  you  called  Colonel  North  and  you 
told  him  that  you  were  asked  to  make  good  on  this,  should  you 
pay  it,  and  he  told  you  to  pay  it? 

A    Yes . 

Q    And  did  he  tell  you  from  which  funds  to  pay  the 
$100,000? 

A    Well,  we  were  only  dealing  with  one  set  of  funds, 
and  that  was  the  assistance  money. 

Q    And  it  was  the  assistance  money  that  had  been 
passed  to  you  by  NEPL? 

A    NEPL  and,  at  that  stage,  maybe  also  the  Heritage 
Foundation,  and — well,  at  least  one  other  contributor. 

Q    who  was  that  one  other  contributor? 


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A    His  name  was  Barness,  B-a-r-n-e-s-s,  and  it  was  a 
single  check  for  $5,000  which  I  sent  to  IC,  Inc.   But  all  the 
al-Masoudi  money  was  assistance  money. 

Q    And  when  you  say  "assistance  money"  you're  referring 
to  money  coming  either  from  NEPL,  from  Heritage  Foundation, 
contributions,  or  to  this  $5,000  from  Mr.  Barness? 

A    Correct. 

Q    Other  than  Mr.  Regan's  invo-lvement ,  which  you 
described  a  bit  earlier,  to  your  knowledge,  was  anyone  else 
at  the  NSC  and  the  White  House,  or  in  any  other  department  or 
agency  of  the  United  States  Government,  involved  with  or 
knowledgeable  of  the  contra  funding  network  that  you  and 
NEPL,  and  Colonel  North  were  engaged  in? 

A    Fawn  Hall.   Robert-  Earl.   I'd  say  that's  about  it. 

Q    To  your  knowledge,  how  would  you  describe  the 
extent  of  Fawn  Hall's  knowledge? 

A    Intimate.   ^ 

Q    And  how  did  you  arrive  at  that  understanding  as  to 
the  extent  of  her  knowledge? 

A    Well,  sometimes  instructions  to  me,  by  North,  would 
be  passed  through  her,  or  a  message  would  be  passed  through 
her,  and  I  might  pass  a  message  back.   He  was  often  out  of 
the  office,  out  of  the  countiry,  and  Fawn  was  a  reliable 
communications  source. 

Q    Was  it  clear  from  your  conversations  with  Fawn  Hall 

iiiiAi  BAAirirn 


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WTCSoMt.  NE  25 

«uhiii(raa.  DC     20002 
(202)  VW-6M6 


that — well,  that  she  knew  about  the  "goings-on"  of  the 
operation? 

A    I  would  say — I'm  probably  not  qualified  to  charac- 
terize what  she  knew. 

MR.  DUDLEY:   I'm  not  sure  what  "goings-on"  are. 
THE  WITNESS:   I  really  don't  know  hew  to  charac- 
terize her  state  of  knowledge. 
BY  MR.  KAPLAN: 

Q    Did  it  appear  from  your  conversations  with  her, 
that  she  was  aware  of  the  nature  of  the  activities? 

A    The  general  nature,  yeah. 

Q    What  about  Robert  Earl? 

A  Well,  given  that  instance  which  I  recalled  to  you 
earlier  this  morning  about  the  chart,  I  get  some  sense  that 
maybe  Earl  was  a  little  more  conversant  with  details. 

Q    Did  you  ever  have  any  conversations  with  Earl,  with 
North,  or  with  anyone  else,  that  led  you  to  the  conclusion 
that  you  just  expressed? 

A    About  Earl? 

Q    Yes . 

A    Yeah,  but  I  can't  recall  any  of  them,  specifically. 

Q     Did  Earl  ever  give  you  any  instructions  with 
respect  to  disbursements  of  funds,  or  the  like,  in  connection 
with  the  contra- funding  activities? 

A    I  don't  remember  any,  specifically. 


IIMOI  AOOinrn 


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llNtUSSlfO 


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1  Q    Was  John  Roberts,  to  your  knowledge,  aware  of  the 

2  nature  of  your  contra-funding  activities? 

3  A    No. 

4  Q    Was  Elliott  Abrams,  to  your  knowledge,  aware  of 

5  those  activities? 

6  A    No. 

7  Q    Who,  at  NEPL,  was  aware  of  these  activities,  other 

8  than  Mr.  Channell  and  Mr.  Conrad? 

9  A    When  you  say  "these  activities",  you're  talking 

10  about  the  assistance? 

11  Q    That's  right.   If  you'll  allow  me,  I'll  refer  to 

12  them  by  the  shorthand  of  "the  network",  but  what  I'm  referring 

13  to  is  the  NEPL,  IBC,  IC,  Inc.,  and  beyond,  funnelling 

14  relationship. 

15  A    Well,  at  IBC  there  was  only  Frank  Gomez  and  myself. 

16  MR.  DUDLEY:   Who  at  NEPL? 

17  THE  WITNESS:   At  NEPL,  I  would  say  Spitz  Channell 

18  and  J)an  Conrad,  Cliff  Smith,  and  of  course  Littledale. 

19  BY  MR.  KAPLAN: 

20  Q    And  how  would  you  describe--if  you  can — Cliff 

21  Smith's  knowledge? 

22  A    General.   But  I  always  got  the  feeling  that  the 

23  solicitations  for  assistance  money  were  done  primarily  by 

24  Spitz. 

mjjn  Kpowrwo  co..  inc  ,       ,  i  ^ 

ytTCSu^.Ni  25  Q  And  what   about   Littledale 's    knowledge?      How  would 

Wuhiniiixs.  O  C     20002 

,202M^«66«  mini  unninrn 


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MU-in  RVOKTMO  CO..  MC. 
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Wuhmiioc.  D  C      20002 
(2021  i4i-666i 


UNCLAS$in[D 


214 


you  characterize  that? 

A    Again,  general. 

Q    How  would  you  characterize  Frank  Gomez's  knowledge 
of  the  contra-assistance  activities? 
A    Peripheral. 

Peripheral .   So — 

Well,  I  don't  know  if  that's  the  right  word. 
Feel  free  to  give  me  more  than  a  one-word  answer. 
Frank  was  knowledgeable  about  the  transactions,  and 
was  knowledgeable  about  the  structure.   The  day-to-day 
details  were  something  that  I  attended  to,  not  Frank. 

Q    And  when  you  say  "knowledgeable  of  the  transac- 
tions", what  exactly  do  you  mean  by  that? 

A    Well,  his  name  had  to  go  on  the  transactions  just 
as  mine  did,  so  he  would  have  been  knowledgeable  about  the 
transactions. 

Q    Did  he  just  come  in  and  sign  letters,  or  did 
someone  explain  to  him  what  was  going  on  here? 

A    Both  he  signed  letters  and  I  received  verbal 
agreement  from  him  when  we  transmitted  Telexes . 

Q    And  did  he  understand  what  the  substance  of  the 
letters  he  was  signing  were? 
A    Yes. 

Q    He  did.   And  did  he  understand  that  he  was  a 
necessary  "spoke  in  the  wheel"',  so  to  speak? 

iBiini  Aootnrn 


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MLLOi  ftroimia  co .  mc. 
)07  C  Streti.  N  E  25 

VaihiniTOfi.  O  C      20002 
(2011  V<6-««6« 


llNi)LA5dthi:i/ 


215 


A    Yes. 

Q    How  would  you  characterize  Jonathan  Miller's 
knowledge,  if  any,  of  the  network? 

A     I  don't  think  he  had  any  knowledge  of  it;  not  from 
me,  anyway. 

Q    Are  you  aware  of  whether  he  had  any  knowledge  of 
the  operation  of  the  network  from  anyone  else? 

A    Well,  he  was  working  for  a  while  fairly  closely 
with  Colonel  North,  and  in  fact  was  working  out  of  his 
office,  Colonel  North's  office,  for  a  while. 

Q    Was  he  engaged  in  the  contra  funding  and  fundraising 
activities? 

A    I  don't  know  that  he  was  involved  in  fundraising, 
but  I  know  Frank  has  reported  to  me  one  instance  when 
Jonathan  offered  traveler's  checks  to  one  of  the  Meskito 
leaders,  and  I  think  it  was  Diego  Wycliff,  but  I'm  not  sure 
which  of  the  Meskito  leaders  it  was. 

Q    When  you  referred  to  "Frank"  a  moment  ago,  you  were 
referring  to  Frank  Gomez? 

A    Yeah.   Frank  told  me  about  an  instance  in  which  he 
was  at  the  National  Security  Council  offices,  and  in  effect 
he  was  doing  the  translation  for  Jonathan,  and  serving  as 
kind  of  an  escort  for  this  Indian  leader,  and  Jonathan  was 
trying  to  convince  him  to  become  part  of  the  resistance 
movement.   And  as  a  show  of  his  good  faith,  he  held  up 

iitiAi  lAAirirn 


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)07  C  Stmt.  N  E.  25 

Wuhinttoo.  D  C     20002 
(202)  M6-«6M 


UNCLASSIF 


216 


several  thousand  dollars  in  traveler's  checks  and  basically 
offered  financial  support  necessary  for  the  guy  to  run  his 
organization  as  part  of  UNO. 

Q    I  take  it  you're  no  relation  to  Jonathan  Miller? 

A    No. 

Q    When  was  the  World  Affairs  Counsellors,  Inc. 
established? 

A    April  1986.   I  believe  the  25th. 

Q    Why  was  World  Affairs  Counsellors  formed? 

A    The  first,  primary  reason  was  to  accept  the  10 
percent  overhead  charge  which  we  began  charging  Colonel  North 
in  the  IC,  Inc.  and  assistance  transfers.   And  secondarily,  we 
wanted  to  do  more  of  this  type  of  business  for  resistance 
movements  or  political  entities — or,  excuse  me — international 
foundations.   And  as  a  result,  we  also  built  into  the  charter 
of  that  organization  political,  media  relations,  strategic 
planning.   That  type  of  thing. 

Q    In  your  prior  testimony,  I  believe  that  you 
testified  that  it  was  some  time  in  late  1985,  that  you 
discussed  with  Colonel  North  your  interest  in  charging  10 
percent  of  the  assistance  funds  that  were  passed  to  IBC,  and 
through  IBC,  is  that  correct? 

A    Right. 

Q    I  take  it  that  you  specifically  recall  mentioning  a 
figure  of  10  percent  to  Colonel  North? 

iiiifii  An^irirn 


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Wuhmpoo.  D  C     10002 
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A    Yes.   I  do. 

Q    And  you  also  testified,  back  in  June,  that  Colonel 
North  commented  to  you  something  like,  10  percent  would  be 
fine  because  most  of  the  people  in  the  contra-assiatance 
business  are  taking  20  to  30  percent.   Is  that  correct? 

A    Yeah.   I  think  it  was  almost  exactly  his  words  that 
he  said,  10  percent  is  fine,  most  of  the  people  involved  in 
this  are  taking  anywhere  from  10--or  anywhere  from  20  to  30 
percent. 

Q     Do  you  recall  the  specific  conversation  in  which 
you  first  raised  with  Colonel  North  this  interest  of  you  and 
Kr.  Gomez  wanting  to  dedsct  10  percent  from  the  asisistance 
payments? 

A    I  don't  remember  the  specific  conversation.   I 
remember  the  basic  elements  of  it. 

Q    would  it  have  been  in  the  context  of  coniversations 
about  other  disbursements  being  made  of  assistance-  funds? 

A    Well,  one  of  the  first  and  foremost  reasons  was 
after  the  al-Hasoudi  business,  and  working  with  the  resistance 
leaders,  it  became  clear  that  this  was  costing  us  money. 

I  mean,  we  were  using  fees  associated  wiith  other 
activities  to  pay  for  our  time  associated  with  this,  and  al- 
Masoudi  had  actually  been  money  out  of  our  pocket,  and  as  a 
consequence  we  thought  we'd  better  start  charging  an  overhead 
fee  or  we  were  going  to  continue  to  lose  money,  and  we 

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218 


weren't  that  profitable,  that  we  could  afford  to  do  it. 

Q    I'm  not  going  to  mark  as  an  exhibit,  but  I'm  going 
to  show  you  a  notation  which  I'll  represent  to  you  is  from 
Colonel  North's  notebook,  dated  November  19,  1985. 

MR.  DUDLEY:   Off  the  record. 

MR.  KAPLAN:   Yes. 

[Brief  discussion  off  the  record.] 

MR.  KAPLAN:   Back  on  the  record. 

I'd  like  the  reporter  to  mark  as  an  exhibit  a  page 
of  notations  which  our  date  stamp  show  were  taken  from 
Colonel  North's  notebooks  provided  to  the  Committees. 

I'd  like  to  state,  for  the  record,  that  this 
Exhibit  15  has  been  reviewed  internally,  and  determined  that 
there  is  no  classified  information  that  hasn't  already  been 
testified  to  by  Mr.  Miller,  or  other  parties,  in  connection 
with  these  investigations. 

The  insertion  of  this  page  of  Colonel  North's 
notebooks  into  the  record  in  no  way  is  intended  as  a  waiver  of 
any  classification  and  declassification  procedure  that 
appropriately  would  apply  to  any  other  notes  in  the  notebooks 
produced  to  the  Committees  by  Colonel  North  in  connection 
with  his  testimony. 

[The  document  referred  to  was  marked  for 
identification  as  Miller  Deposition 
Exhibit  No.  15.] 


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BY   MR.    KAPLAN: 

Q    Mr.  Miller,  do  you  recognize  the  handwriting  on 
Deposition  Exhibit  15? 

A    Well,  I  think  it's  Colonel  North's  handwriting. 

Q    And  reading  down,  it  says,  "R.  Miller",  and  I've 
assumed  that  that  applies  to  you.   Are  you  aware  of  any  other 
R.  Millers  with  whom  Colonel  North  had  dealings  or  conversa- 
tions? 

A    No. 

Q    And  at  the  top  of  the  page  is  the  notation,  19,  N- 
o-v,  for  November — and  I'll  represent  to  you  that  this  came 
from  a  1985  notation.   It  states  a  time,  I  believe,  as  11:30, 
and  as  I  can  read  it,  I  believe  it  says,  "On  hand,  and  acted 
on .  " 

And  then  it  lists  information  as  to  the  movement, 
or  requested  movement  of  certain  amounts  of  money  to  various 
recipients . 

Are  those  recipients  that  you  recognize? 

A    Yes,  but  I  think  you've  misread  it.   I  think  it 
says  "Oliver  North  had  and  acted  on."   I  think  that's  "O.N." 

Q    O.N.  stands  for  Oliver  North.   Okay.   And  does  this 
notation  refresh  your  recollection  as  to  a  conversation  you 
had  with  Colonel  North  back  on  November  19,  1985? 

A    This  is  the  probably  the  conversation  that  you  and 
I  just  spoke  of  a  moment  ago. 

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MR.  DUDLEY:   His  question  to  you  was  whether  it 
refreshes  your  recollection-.   He  asked  you  a  number  of  things 
about  it.   He  asked  you  the  substance  of  it,  and  he  asked  you 
the  date  of  it,  and  I  think  he's  asking  if,  after  reviewing 
that,  you  now  have  any  further  independent  recollection 
either  of  the  substance  of  the  conversation  or  whether  it 
actually  took  place  on  November  19th. 

MR.  KAPLAN:   That's  correct. 

THE  WITNESS:   I  can't  confirm  whether  it  was 
November  19th.   It  seems  to  me  that  all  these  transfers  are 
transfers  that  we  got  instructions  for  pretty  much  all  at 
once,  and  this  church  account  thing  at  the  bottom  is  exactly 
what  I  got  for  the  transfer  to  the  church  account.   So  it's 
probably  all  the  same  conversation. 

BY  MR.  KAPLAN: 
Q    Okay.  And  toward  the  bottom  of  the  top  half  of  the 
page,  you  see  the  notation  that  says,  and  I  quote:  "IBC, 
dasji,  10  percent."  Close  quote. 
A    Right . 

Q    Is  this  note  consistent  with  your  general  recollec- 
tion as  to  Colonel  North's  approval  of  you  and  Mr.  Gomez 
charging  10  percent  for  your  seirvices  and  professional  risk  in 
your  activities  in  connection  with  the  contra  funding,  or 


contra-assistance  network? 


A    Yes. 


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CO.,  MC. 

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Q    So  if  Colonel  North  were  to  say  that  he  never 
discussed  a  specific  number  with  you,  I  take  it  that  you 
would  say  his  recollection  was  probably  wrong? 

MR.  DUDLEY:   I  object  to  asking  witnesses  to 
conunent  on  testimony  of  other  witnesses.   He  can  tell  you  what 
his  recollection  is,  and  from  that  you  can  draw  your  con- 
clusions, but  I  don't  think  it's  appropriate  to  ask  one 
witness  whether  another  witness  is  right,  or  wrong. 
BY  MR.  KAPLANS 

Q    Would  it  be  inconsistent  with  your  recollection,  if 
Colonel  North  testified  that  he  didn't  recall  discussing  a 
specific  number  with  you? 

A    I  don't  know  what  you  mean  by  "specific  number." 

Q    That  is,  10  percent. 

A     If  the  question's  10  percent,  then  that  would  be 
inconsistent. 

Q    But  I  take  it  that  your  recollection,  independent 
of  Exhibit  15,  and  as  refreshed  or  confirmed  by  Exhibit  15, 
is  that  you  specifically  asked  Colonel  North  for  approval  to 
charge  10  percent  of  the  money  that  was  passed  through  IBC 
for  contra  assistance? 

A    That's  correct. 

Q    I  take  it  that  your  recollection  is  that  you 
specifically  received  his  approval  for  the  10  percent  figure? 

A    Yes. 


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[Brief  recess . ] 

MR.  KAPLAN;   Let's  go  back  on  the  record. 

BY  MR.  KAPLAN: 

Q    After  receiving  Colonel  North's  approval  to  begin 
charging  this  10  percent,  when  did  you  begin  to  deduct  the  10 
percent  from  the  contra-assistance  payments  that  were  passing 
through  IBC? 

A    There  was  one  $400,000  contribution  where  10 
percent  was  deducted,  and  then  I  think  most  of  it  was 
deducted  in  the  Grand  Caymans,  and  some  of  it  was  done  in 
retroaction  to  the  formation  of  World  Affairs  Counsellors. 
Because  they  just  didn't  have  time  to  get  down  there  and  form 
World  Affairs  Counsellors,  and  so  we  had  to  do  it  in  retrosp- 
ect. 

Q    And  when  you  say  it  was  done  in  retrospect,  did  you 
begin  deducting  the  10  percent  as  a  paper  matter,  some  time 
prior  to  the  formation  of  World  Affairs  Counsellors? 

A    Yes. 

Q    Do  you  recall  when  you  started  deducting  the  10 
percent  as  a  paper  matter? 

A    It  was  pretty  close  to  this  period  in  time. 

Q    Go  ahead,  if  you've  got  something  to  add. 

A    No. 

Q    Do  you  recall  the  total  amount  of  funds  that  were 
deducted  as  part  of  this  10-percent  charging  of  the  contra- 

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assistance  payments? 

A    I  don't  have  an  exact  figure  for  you  but  it's 
somewhere  around  250  to  $300,000. 

Q  All  right.   Is  it  possible  that  the  amount  is 

closer  to  440  to  $450,000? 

A    No. 

[Witness  and  attorney  consult.] 
THE  WITNESS:   I  know  what  your  concern  is.   The 
tail  end  of  1986,  Colonel  North  gave  us  a  directive  to  use 
the  remaining  money  in  the  account  to  pay  legal  fees  as- 
sociated with  what  we  expected  to  be  inclusion  in  some  of  the 
matters  that  were  pending  down  in  the  Federal  court  in  Miami . 
And  in  addition  to  that,  we  also  sought  reimburse- 
ment for  some  specific  items-,  and  in  fact  had  to — for 
instance — reimbursement  Miller  Communications  for  the  10,000 
that  went  ^o^^^^^^H  Things  like  that.   And  there  was 
generally  a  paper  ledger  kept  on  that. 
BY  MR.  KAPLAN: 

Q    Did  any  funds  make  their  way  into  World  Affairs 
Counsellors,  that  were  not  part  of  this  10-percent  charge,  or 
commission? 

A  Any  funds  removed  from  IC,  Inc.  that  were  commis- 
sion or  reimbursement,  that  was  the  only  way  they  went,  was 
into  World  Affairs  Counsellors. 


So  that-- 


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A    So  it's  the  rule  rather  than  the  exception. 

Q    So  that  if  440  to  $450,000  made  its  way  into  World 
Affairs  Counsellors,  that  might  well  represent  the  total 
amounts  that  were  deducted,  or  charged  off  as  part  of  this 
10-percent  charge  or  commission. 

A    That's  correct,  although  I  think  there  are  some 
charges  on  this  side  of  the  Gulf  of  Mexico.   I  think  there 
are  some  charges  in  IBC  accounts,  at  times,  when,  for 
expediency  reasons,  money  was  transferred  from  IBC. 

Q    But  if  the  records  reflected  that  approximately  440 
to  $450,000  were  deducted  from  IC,  Inc.,  and  placed  into  the 
World  Affairs  Counsellors'  account,  you  wouldn't  dispute  that 
that  amount  is,  if  not  all,  at  least  very  largely  attributable 
to  the  10-percent  charge,  or  commission  that  Colonel  bkarth 
approved  back  in  November  1985.   Is  that  correct? 

A    If  you  want  me,  I'll  define  large  for  you.   I  know 
at  least  100,000  of  it  was  for  legal  fees  at  his  direction, 
and.  I  can't  give  you  an  exact  figure,  but  several  tens  of 
thousands  more  were  for  specific  reimbursement  items. 

Q    But  nonetheless,  the  $100,000  for  legal  fees,  I 
take  it,  was  money  that  was  taken  for  the  personal  benefit  of 
you,  or  Mr.  Gomez?   I  mean,  the  legal  fees  were  at  least 
intended  to  be  paid  on  behalf  of  you  or  Mr.  Gomez's  behalf, 
is  that  right? 

A    That's  correct. 


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Q    So  it  might  not  have  been  a  part  of  the  10-percent 
charge  or  commission  that  Colonel  North  approved,  but 
nonetheless  all  monies  that  went  into  World  Affairs  Counsel- 
lors were  monies  that  were  ultimately  used  for  the  benefit  of 
either  you  or  Mr.  Gomez? 

A    No. 

Q    Tell  me  where  I'm  wrong,  because  we  can  clarify  the 
record  on  this,  and  move  on. 

A    Well,  if  you  are  willing  to  accept  that  there  were 
reimbursement  items  in  that  money,  then  those  items  were  not 
for  our  benefit.   They  were  simply  reimbursement  to  us  for 
expenditures  that  we  had  to  make. 

Q    What  kinds  of  expenditures  would  those  have  been 
reimbursement  for? 

like  the         to^^^^^^^^^^^^H that 
had  to  come,  out  of  Miller  Communications.  There  was  $10,000 
in  the  cost  of  setting  up  the  original  corporations .   There 
was  $100,000  in  legal  fees.   I  can't  think  of  all  of  them, 
off  the  top  of  my  head. 

Q    The  $100,000  in  legal  fees,  for  instance. 
[Witness  and  attorney  consult.) 
BY  MR.  KAPLAN: 

Q    The  $100,000  in  legal  fees,  for  instance,  for  whose 
benefit  was  that  money  either  spent,  or  intended  to  be  spent? 

A    Well,  to  defend  IBC.   I  mean,  we  fully  expected  the 


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organization  to  come  under  legal  attack. 

Q    And  who  were  the  two  partners  of  IBC? 
A    Frank  Gomez  and  Rich  Miller. 

MR.  KAPLAN:   I'm  going  to  ask  the  reporter  to  mark 
as  Deposition  Exhibit  16,  again,  a  composite  exhibit.   I'm 
not  going  to  ask  you  any  questions  about  the  top  letter 
because  I  think  you've  covered  that  in  your  testimony. 
[The  document  referred  to  was  marked  for 
identification  as  Miller  Deposition 
Exhibit  No.  16. ) 
BY  MR.  KAPLAN: 
Q    The  second  page  of  the  exhibit  purports  to  be  a 
letter  from  David  Piesing,  at  Cayhaven  Corporate  Services, 
Limited,  to  you,  dated  May  H,  1986.   The  letter  is  short, 
and  I'll  just  read  it  into  the  record. 

It  says,  quote:  "I  refer  to  the  verbal  instructions 
that  you  gave  me  during  your  trip  here  earlier  in  the  month." 
That  is,  that  you  gave  to  Mr.  Piesing.   "For  some  reason  it 
was  overlooked,  but  we  shall  need  written  instructions  from 
you  to  automatically  deduct  10  percent  from  any  grants 
received  from  this  company,  and  to  pay  the  10  percent 
deduction  over  to  World  Affairs  Counsellors,  Inc.  as  a 
commission."   Close  quote.   The  rest  are  salutary  words. 
Can  you  identify  this  letter? 
A    Yeah.   This  was  a  letter  from  me  to  Mr.  Piesing, 


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referring  to  my  instructions  that  from  the  beginning  of  World 
Affairs  Counsellors,  any  monies  that  came  into  IC,  Inc., 
there  was  to  be  an  automatic  deduction  of  10  percent,  and 
that  money  was  to  be  deposited  in  World  Affairs  Counsellors. 

Q    And  those  instructions  that  you  gave  to  Mr.  Piesing 
were  simply  the  carrying  out  of  an  approval  that  Colonel 
North  had  given  to  you  back  in  November  of  1985? 

A    Yes.   But  this  was  at  the  formation  of  World 
Affairs  Counsellors. 

Q    Right. 

A    The  instructions  were  that  any  money  that  came, 
once  World  Affairs  Counsellors  had  been  established — any 
money  from  that  date  forward,  that  came  into  IC,  Inc.,  there 
was  to  be  a  10  percent  automatic  deduction. 

Q    And  the  10  percent  that  is  mentioned  in  this  letter 
is  not  pulled  out  of  thin  air,  it  is  the  10  percent  charge, 
or  commission,  or  compensation  that  Colonel  North  approved 
bacJc  in  November  of  1985,  and  for  which  you  had  begun  to 
deduct  as  a  paper  matter  some  time  shortly  thereafter? 

A    That  is  correct. 

Q    Okay.   Tell  me  why  you  felt  entitled  to  receive  the 
10  percent  that  you  requested  from  Colonel  North. 

A    Well,  I  don't  like  the  word  "entitled."  We  had  run 
what  I  thought  were  extreme  risks  with  the  al-Masoudi 
business.   It  had  cost  us  personally,  financially.   It  had 


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taken  up  a  tremendous  amount  of  professional  time.   It  was, 
as  any  lawyer  will  tell  you,  or  anybody  who  bills  their  time, 
opportunities  lost  to  make  money  with  paying  clients,  and  our 
role  with  Colonel  North  seemed  to  be  growing,  and  he  seemed 
to  be  asking  us  to  do  more  all  the  time.   And  there  was  no 
way  for  us  to  continue  to  do  that  unless  we  could  start 
compensating  ourselves,  since  we  were  the  primary  wage-earners 
for  the  rest  of  the  employees  at  IBC . 

Q    On  what  basis  did  you  think  Colonel  North  was 
authorized  to  approve  your  taking  10  percent  of  the  funds? 

A    Just  by  virtue  of  who  he  was.   He  seemed  to  be  in 
control  of  the  operation. 

Q    And  was  it  your  understanding  that  once  the  funds 
for  contra  assistance  left  HEPL,  that  they  basically  were 
under  the  complete  discretion,  or  control  of  Colonel  North? 

A    I  viewed  t.hem  that  way,  yes. 

Q    And  you  testified  earlier  this  morning,  that  there 
was  a  time  at  which  Mr.  Channell  told  you  that  he  was  going 
to  begin  to  deduct  20  percent  from  the  contributions  intended 
for  contra  assistance. 

Was  this  about  the  same  time  that  you  obtained 
Colonel  North's  approval  to  10  percent  as  a  charge  for  you 
and  Mr.  Gomez? 

A    I  don't  think  that's  exactly  what  I  said.   I  said  I 
recall  one  time  when  Mr.  Channell  told  me  he  was  going  to 


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deduct  for  his  organization  20  percent  from — and  I  think  it 
was  a  Barbara  Newington  contribution  of — I  think  the  total 
was  $1.2  million,  or  something.   And — 

Q    Was  that  the  Newington  contribution  to  which  you 
testified  on  June  23rd? 

A    Yeah.   And  the  subsequent,  too,  I  think. 

Q    Other  than  the  World  Affairs  Counsellors'  payments, 
did  you  receive  any  other  benefits  from  your  activities 
involved  in  the  contra-assistance  network? 

A    Financial  benefits? 

Q    Financial  benefits. 

A    Well,  we  were  paid  fees  by  Mr.  Channell  for  our 
work  on  his  programs,  but,  no. 

Q    Do  you  have  knowledge  of  anybody  else,  other  than 
perhaps  NEPL,  as  an  entity,  or  Mr.  Channell  or  Mr.  Conrad, 
through  NEPL,  deriving  any  benefit  from  the  provision  of 
monetary  assistance  to  the  contras? 

A  Well,  I  think  all  their  salaries  were  paid  by  NEPL, 
so  'they,  like  any  employee  of  an  organization  that  undertakes 
a  prograun,  they  receive  salaries  from  that  organization. 

Q    Do  you  have  any  knowledge  of  anyone  else  receiving 
any  financial  benefit  from  this  contra-assistance  network? 

A    Not  other  than  what  I've  described  to  you  in 
previous  transactions  from  IC,  Inc.   I  don't  have  anybody 
that  comes  readily  to  mind. 


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Q    Okay.   What  was  your  understanding  as  to  the 
intended  purpose  of  the  contra-assistance  payments  that  were 
made  through  IBC,  or  through  IC,  Inc.? 

A    The  general  purpose  was  for  the  provision  of 
assistance  to  the  Nicaraguan  resistance.   It  became  clear, 
early  on  in  the  relationship  with  Colonel  North,  that  that 
meant  a  fairly  diverse  group  of  people  receiving  assistance. 
And  in  regards  to  the  specific  fundraising,  we,  at  Mr. 
Channell's  direction,  or  request,  tried  to  identify  specific 
items  which  people  could  raise,  could  give  their  money  for. 
These  people  who  gave  large  sums  wanted  to  do  it 
for  something  that  was  identifiable,  and  not  for  general 
financial  assistance. 

Q    And  you  testified  Jaack  on  June  23rd,  I  believe, 
that  Mr.  Channell  focused  on  certain  lethal  supplies,  in  many 
instances,  as  enticing  donors  to  make  contributions  for 
contra  assistance,  is  that  correct? 

A    I  wouldn't  accept  the  characterization,  but  I  would 
say  that,  initially,  our  fundraising  was  targeted  at  general 
assistance.   It  began  to  incorporate  things  such  as  heavy- 
lifting  systems,  Maule  aircraft.   The  later  period,  Mr. 
Channell  began  to  raise  money  for  specific  weapons. 

Q    And  anti-aircraft  missiles? 

A    Anti-aircraft  missiles,  specifically. 

Q    And  there  were  instances,  as  you  testified,  back  on 


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June  23rd,  in  which  Colonel  North  supplied  the  information  as 
to  what  the  contras '  needs  were  with  respect  to  some  of 
these,  both  lethal  and  non-lethal  supplies? 

A    That's  correct. 

Q    And  you  also  testified,  back  on  June  23rd,  that 
Colonel  North  participated  in  some  of  the  solicitations 
intended  for  the  purchase  of  these  big-ticket  items,  both 
lethal  and  non-lethal  supplies,  is  that  correct? 

A    Colonel  North  made  presentations  to  people  prior  to 
a  solicitation  from  Mr.  Channell.   That's  correct. 

Q    And  part  of  his  presentation,  at  times,  included 
references  to  lethal  supplies  as  well  as  non-lethal  supplies? 

A    In  the  single  instance  which  I  can  remember,  a 
discussion  of  lethal  supplies,  I  don't  know  whether  Colonel 
North  was  still  in  the  room  at  the  time,  but  I  don't  believe 
he  was . 

Q    Now  to  refresh  your  recollection,  on  June  23rd,  you 
testified  in  response  to  my  questions  as  follows: 

"Question.    Did  North  describe  the  capability  of 
the  shoulder-held  surface-to-air  missile  that  was  in  the  file 
folder  to  counteract  the  Hind  helicopter?" 

"Answer.   He  did  refer  to  surface-to-air  missiles, 
but  only  generally.   I  don't  think  he  specifically  referred 
to  the  one  in  the  folder. " 

"Question.   When  you  said  before  that  Colonel  North 


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referred  briefly  to  the  final  folder  that  you  prepared,  how 
did  he  refer  to  it?" 

"Answer.   I  don't  remember  the  specific  conversa- 
tion, but  he  was  describing  to  Mrs.  Newington  how  the  Hind 
helicopters  had  changed  the  battlefield  tactics  of  the 
resistance  forces,  breaking  them  into  smaller  units,  not 
allowing  them  to  have  large  collections  of  soldiers.   I  also 
had  a  copy  of  a  New  York  Times  piece  on  the  Hind  helicopter, 
and  as  I  remember,  he  used  that  far  more  prominently  than  he 
used  the  folder." 

'Question.   Did  Mrs.  Newington  ask  Colonel  North  if 
he  knew  where  to  obtain  surface-to-air-missiles?" 

"Answer.   As  I  recall,  her  specific  question  was, 
'And  you  know  where  to  get  these?',  and  he  said,  'Yes,  we 
know . ' " 

"Question.   And  did  Colonel  North  quote  any  prices 
to  Mrs .  Newington? " 

"Answer.   I  don't  recall." 

MR.  DUDLEY:   Is  that  supposed  to  be  inconsistent 
with  what  he  just  said? 

BY  MR.  KAPLAN: 
Q    Now  does  that  refresh  your  recollection  as  to 
whether  Colonel  North  ever  participated  in  the  solicitation 
of  funds  intended  for  the  purchase  of  lethal  supplies? 

MR.  DUDLEY:   I  object  to  this  line  of  inquiry,  and 


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I  don't  think  that's  proper,  either  as  refreshment  of 
recollection,  or  his  impeachment,  but  I'll  let  him  answer  the 
question . 

It  seems  to  me  that  there  is  absolutely  no  inconsis- 
tency between  that  and  what  he  just  testified  to. 

THE  WITNESS:   And  I  guess  what  I'd  ask  you  to  do  is 
define  your  definition  of  "solicitation." 

MR.  DUDLEY:   I  think  that's  where  you're  falling 
apart,  is  you're  using  the  word  differently. 

THE  WITNESS:   I  Just  need  to  know  what  you 
consider  solicitation. 

BY  MR.  KAPLAN: 
Q    Did  Colonel  North,  in  your  presence,  ever  describe 
to  any  contributor  the  contras '  needs  for  any  particular 
lethal  supplies? 

A    In  general  terms,  in  conversation  with  Mrs. 
Newington,  he  described  surface-to-air  missiles  as  devices  to 
shoot  down  Hind  helicopters.     « 

Q    And  we've  just  read  your  testimony  from  June  23rd 
in  which  you  stated  that  he  even  told  Mrs .  Newington  that  he 
knew  where  to  get  these  missiles.   Is  that  correct? 

MR.  DUDLEY:   It  is  correct  that  you  read  that.   Now 
are  you  asking  him  if  his  testimony  is  correct? 

MR.  KAPLAN:   Right.   I  mean  if  his  testimony's 
changed,  I  certainly  want  to  know  about  it. 


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THE  WITNESS:   No,  no,  it's  not  changed  at  all.   In 
fact  I  think  I  may  have  also  said  to  you  that  "we"  was  a 
euphemistic  term  that  he  used,  as  a  convention  in  conversa- 
tions with  people.   And  one  got  the  sense,  when  he  said  that, 
that  he  was  speaking  more  about  the  resistance  than  he  was 
about  himself.   So  "we"  was  a  collegial  term  which  he  used. 

BY  MR.  KAPLAN: 
Q    That  wasn't  my  question.   My  question  was,  is,  in 
your  testimony  on  June  23rd  you  testified  that  Colonel  North 
told  Mrs.  Newington  that  he  knew  where  these  missiles  could 
be  purchased. 

My  question  is,  is  that  testimony  still  accurate 


today? 


said  yes. 


MR.  DUDLEY:   And  h« ' s  answered  that  question.   He 


MR.  KAPLAN:   All  right.   And  that's  a  yes  or  no. 

MR.  DUDLEY:   He  answered  it. 

MR.  KAPLAN!   And  if  he  could  answer  it,  I  would 
appreciate  it. 

MR.  DUDLEY:   Answer  it  again. 

THE  WITNESS:   I'm  not  going  to  answer  it  yes  or  no 
because  it's  not  a  yes  or  no  answer.   I  mean,  he  used  the 
term  yes,  we  know  where  to  get  them,  and  the  "we"  that  he 
used  then  was  a  euphemistic  term  which  he'd  used  on  other 
occasions  in  my  presence,  and  the  sense  that  one  had--and  I'm 


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VahiMoa.  DC.    20002 


ICLASSIFIED 


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sure  Mrs.  Newington  had  from  the  conversation — was  that  he 
was  speaking  in  a  collegial  .sense,  and  that  he  was  as  much 
talking  about  the  resistance  as  he  was  about  his  own  know- 
ledge. 

BY  MR.  KAPLAN: 
Q    How  can  you  testify  as  to  what  Mrs.  Newington 's 
understanding  was  of  what  Colonel  North  told  her? 

MR.  DUDLEY:   You've  asked  him  questions  all  day 
about  what  people  understood,  and  when  you  want  him  to  get 
inside  somebody's  head,  you're  perfectly  happy  to  ask  it. 

MR.  KAPLAN:   And  he  consistently  has  refused  to 
answer  those  questions . 

MR.  DUDLEY:   Well,  he  said  from  contact — 

MR.  KAPLAN:   On  the  few  times  that  I  have  asked 
him,  and  with  specific  reference  to  his  knowledge--!  have  not 
asked  him  what  was  in  Mrs.  Newington 's  mind.   I've  asked  him 
a  simple  question  which  is  whether  his  testimony  on  June  23rd 
stands  correct  and  true  as  of  today. 

And  the  answer  is  a  yes  or  no  answer.   That's  what 
I'm  asking  for  and  that's  what  I  would  like  from  the  witness. 

MR.  DUDLEY:   :And  he  has  given  you  that  answer. 

MR.  KAPLAN:   Would  you  please  provide  an  answer  to 
that  question,  yes  or  no. 

THE  WITNESS:   The  answer  to  your  question  about  my 
testimony  of  June  twenty-- 


fPI  JlCOsrirn 


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(202)  i*i-U6t 


ONCmSSiFIED 


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MR.  KAPLAN:   Third. 
THE  WITNESS:   --third  is  yes. 
MR.  KAPLAN:   Thank  you. 

I'm  going  to  ask  the  reporter  to  mark  as  Deposition 
Exhibit  17. 

[The  document  referred  to  was  marked  for 
identification  as  Miller  Deposition 
Exhibit  No.  17 . ] 
MR.  KAPLAN:   It  is  the  cover  page  plus  the  first 
two  pages  of  a  report  prepared  by  International  Business 
Communications  and  submitted  to  the  Committees  by  your 
counsel . 

BY  MR.  KAPLAN: 
Q    I  ask  you  to  turn  .to  turn  to  page  3  of  the  exhibit. 
It's  the  last  page.   The  aecond-to-last  paragraph  from  the 
bottom  states  that  some  of  the  funds,  as  shown  in  the 
attached  materials,  were  deposited  to  the  account  of  Lake 
Resources,  Inc.  at  Credit-Suisse  Banque  in  Geneva,  at  the 
request  of  Lt.  Col.  Oliver  L.  North. 

And  I'll  skip  the  sentence  and  go  down  to  the  last 
sentence  in  that  paragraph  which  reads:  "However,  we  were 
assured  by  him  at  the  time,  that  the  funds  were  to  be  applied 
solely  for  humanitarian  assistance." 

And  my  question  is,  did  you  believe  that  to  be  an 
accurate  statement  when  this  report  was  written  in  February 

iiiini  AnAir'if-1% 


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237 


1987? 

A    Yeah,  but  I've  got  to  tell  you  that  I  rue  the  day  I 
wrote  those  final  five  words. 

Q    And  can  you  tell  me  why  you  rue  that  day. 

A    Because  I  should  have  said  "were  used  for  non- 
lethal  assistance"  and  that  would  have  been  a  far  more 
accurate  characterization. 

Q    Didn't  you  have  an  understanding,  either  from 
Colonel  North,  or  from  Mr.  Channell  or  Mr.  Conrad,  that  at 
least  some  of  the  monies  solicited  were  intended  for  the 
purchase  of  lethal  supplies? 

A    Well,  specifically,  Mrs.  Newington's  contribution 
was  for  surface-to-air  missiles.   Later,  in  that  period  of 
time,  that  she  gave  the  final  contribution,  the  helicopters 
seemed  to  be  active,  and  there  seemed  to  be  little  indication 
that  there  were  missiles  on  the  ground  to  counteract  them. 

And  the  news  accounts  indicated  that  the  number  of 
missiles  that  the  resistance  had  was  still  low.   And  I  raised 
the  issue  to  Colonel  North,  asking  him  in  effect  where  were 
the  missiles,  and  he  said  they  needed  missiles,  but  they 
needed  these  more.   And  he  pulled  out  a  brochure  of  radios, 
some  kind  of  secure,  encrypted  radios  of  some  sort,  and  told 
me  that  that  money  had  been  spent  on  radios . 

So  with  the  missiles  removed  from  the  matrix,  I 
felt  quite  comfortable  with  the  characterization  you  see  in 


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(202)  V4«-6«6« 


UNCLASSIFIED 


238 


this  because  the  other  money  was  used  for  the  heavy  lifting 
and  the  air  resupply  operation. 

Q    Now  you  testified  this  morning  that  you  plead 
guilty  to  a  one-count  information,  in  part  based  on  activities 
in  which  NEPL's  tax-exempt  status  was  used  for  the  solicita- 
tion of  money  intended  for  the  purchase  of  lethal  supplies. 

And  is  that  a  fair  characterization  of  your 
testimony  this  morning? 
A    Yes. 

Q    And  am  I  mistaken  in  my  belief  that  that  charac- 
terization— well,  your  testimony  is  somehow,  or  another, 
inconsistent  with  the  statement  in  this  report  about  which  we 
were  just  talking? 

MR.  DUDLEY:   I'm  not   going  to  let  him  answer  a 
question  like  that.   Come  on. 

MR.  KAPLAN «  Are  you  going  to  instruct  him  not  to 
answer? 

MR.  DUDLEY:   Yes. 

MR.  KAPLAN:   Can  I  ask  you  to  state  for  the  record 
the  basis  for  your  instruction. 

MR.  DUDLEY:   Because  the  question  of  whether  you 
are  correct  in  drawing  inferences  you  want  to  draw  about 
consistencies  is  not  something  that  he's  in  a  position  to 
comment  on. 

MR.  KAPLAN:   That's  fine.   I'll  rephrase  the 

uimi  Aooinrn 


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507CSir«t.  NE  25 

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{202)  M6-46M 


question. 

BY  MR.  KAPLAN: 

Q  Is  your  testimony  this  morning  consistent,  the 
statement  in  the  report,  that  is.  Deposition  Exhibit  17, 
about  which  we've  just  been  talking? 

A    I  don't  think  it's  consistent  or  inconsistent. 
This  was  a  report  to  Mr.  Channell  on  expenditures.   The 
information  that  you've  asked  me  about  and  the  guilty 
proceeding  that  took  place  were  not  about  expenditures.   They 
were  about  the  means  to  raise  the  money  for  that  effort,  and 
there's  a  diametric  difference  between  the  two. 

And  that  I  think  you  need  to  be  clear  on  because 
this  report  is  an  attempt  to  codify  for  Mr.  Channell  the 
expenditures  that  we  undertook.   So  that  statement  is  about 
expenditures,  and  with  the  surface-to-air  missiles  removed 
from  the  matrix,  there  was  nothing  left,  to  my  knowledge,  of 
a  lethal  sort. 

Q    I  don't  want  to  get  into  a  semantic  argument  with 
you,  but  in  looking  at  the  statement  to  which  you're  referr- 
ing, I  don't  see  the  term  "expenditures."   What  I  see — and 
we'll  quote  it  again — is  "We  were  assured  by  him--that  is. 
Colonel  North — at  the  time,  that  the  funds  were  to  be  applied 
solely  for  humanitarian  assistance."   That  is,  were  to  be 
applied. 

And  what  I'm  asking  is,  is  that  consistent  with 

mm  ftiH-inrn 


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your  testimony  this  morning,  that  you  plead  guilty  to  a  one- 
count  information  because  of  the  fact  that  you  considered 
NEPL's  tax  exempt  status  to  have  been  misused  with  respect  to 
solicitations  intended  for  the  purchase  of  lethal  supplies. 

MR.  DUDLEY:   Despite  your  disclaimer,  Mr.  Kaplan, 
that  question  is  absolutely  nothing  but  argument.   You  can 
make  that  argument,  if  you  want  to  make  that  argiiment .   If  you 
think  they're  inconsistent,  fine. 

MR.  KAPLAN:   I  asked  a  question,  and  I  would  like  an 
answer  to  the  question. 

MR.  DUDLEY:   I  object  to  the  question. 

MR.  KAPLAN:   All  right.   Could  you  please  read  the 
question  back? 

MR.  DUDLEY:   It'll-  take  him  a  long  time. 

MR.  KAPLAN:   That's  fine.   I've  got  plenty  of  time. 

REPORTER:   "I  don't  want  to  get  into  a  semantic 
argument  with  you,  but  in  looking  at  the  statement  to  which 
you.' re  referring,  I  don't  see  the  term  expenditures.   What  I 
see — and  I  will  quote  it  again:   'We  were  assured  by  him' — 
that  is,  Colonel  North — 'at  the  time  that  the  funds  were  to 
be  applied  solely  for  humanitarian  assistance.'   That  is, 
'were  to  be  applied' . 

"And  what  I'm  asking  is  is  that  consistent  with  your 
testimony  this  morning?   You  plead  guilty  to  a  one-count 
information  because  of  the  fact  that  you  considered  NEPL's 

IBBIAa  m^^ 


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tax  exempt  status  to  have  been  misused  with  respect  to 
solicitations  intended  for  the  purchase  of  lethal  supplies." 

MR.  DUDLEY:   I  further  object  to  the  question  on  the 
grounds  that  having  had  it  read  back  to  me,  I  don't  understand 
it.   It's  incomprehensible.   And  that  it's  been  asked  and 
answered. 

MR.  KAPLAN:   I'd  press  the  question. 

MR.  MILLER:   I  think  I've  told  you  two  things  that 
are  a  direct  answer  to  your  question,  the  first  of  which  is  I 
rue  the  day  I  wrote  those  five  words .   And  the  second  is  that 
again  this  was  a  report  to  Mr.  Channell  on  expenditures,  not 
a  report  on  the  solicitation  of  items.   And  with  those  two 
things,  I  think  I  have  fully  answered  your  question. 

MR.  KAPLAN:   And  i-s  it  your  testimony  today  that  the 
statement  which  we  have  been  focusing  on  is  consistent  with 
your  guilty  plea  in  May  of  this  year? 

MR.  DUDLEY:   I'm  not  going  to  let  him  answer  it  a 
third  time.   That's  about  all  the  answer  you're  going  to  get. 

MR.  KAPLAN:   He  hasn't  answered  it  yet.   You 
instructed  him  not  to  answer  it  the  last  time. 

MR.  DUDLEY:   I  have  not  instructed  him  not  to 
answer  it.   I  now  am  instructing  him  not  to  answer  it  a  third 
time. 

MR.  KAPLAN:   On  what  basis?   I'd  like  your  basis 
stated  for  the  record. 

IIMOI  Aooinrn 


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MR.  DUDLEY:   That  it  is  abusive  and  repetitive. 
MR.  KAPLAN:   I  don't  understand  that  to  be  a  basis 
for  an  instruction  not  to  answer.   I  would  direct  the  witness 
to  please  answer  the  question. 

MR.  DUDLEY:   You  don't  have  the  power  to  direct  him 
to  do  anything. 

MR.  KAPLAN:   Let's  go  off  the  record. 
BY  Mr.  KAPLAN: 
Q    Mr.  Miller,  can  you  explain  to  me  what  IBC's  role 
was  in  connection  with  various  White  House  briefings  that 
were  set  up  by  NEPL  contributors  or  potential  contributors 
throughout  1985  and  1986? 

A    We  would  contact  the  appropriate  office  in  the 
White  House  when  Mr.  Channel!  determined  that  he  wanted  to 
give  a  briefing  to  his  contributors.   We  would  provide  the 
basic  background  materials  for  the  White  House  office  that 
would  then  make  the  memorandum  recommending  the  meeting.  We 
provided  suggested  talking  points,  suggested  schedules, 
proposed  dates,  and  associated  audio-visual  materials. 

And  we  then  worked  with  the  NEPL  organization  to 
coordinate  schedules  for  arrival,  clearance  into  the  building, 
escort  to  the  room,  and  departing  the  building  and  reas- 
sembling the  group  in  whatever  the  location  was  that  Mr. 
Channell  then  had  a  subsequent  meeting  in. 

Q    With  whom  in  the  White  House  or  the  administration 

iiiiAi  Annirirn 


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did  you  deal  in  coordinating  these  briefings  on  that  side? 

A    Primarily  the  Office  of  Public  Liaison,  Linda 
Chavez,  Linas  Kojelis,  Pat  Buchanan's  office.   And  we  kept 
Colonel  North  informed--I  at  least  kept  Colonel  North 
infonned--of  the  briefings.   And  in  some  instances  we  asked 
specifically  for  him  as  a  briefer. 

Q    Who  put  you  in  touch  with  the  Office  of  Public 
Liaison  in  the  White  House? 

A    Nobody . 

Q    Did  you  know  Linda  Chavez? 

A    I  had  met  her  before,  and  I  was  known  to  the  people 
in  the  White  House  Public  Liaison  Office. 

Q    Did  you  know  Mr.  Kojelis? 

A    Not  before  a  meeting  with  him  in  preparation  for 
one  of  these  meetings . 

Q    Did  Colonel  North  help  to  facilitate  or  coordinate 
these  White  House  briefings? 

A    I  think  the  first  one  he — I  can't  recall  specif- 
ically, but  I  think  the  first  one  we  asked  directly  of  his 
office  for  a  briefing.   And  then  subsequently  we  just  simply 
started  doing  it  to  the  Office  of  Public  Liaison.   But  I 
think  the  first  request  went  directly  to  his  office. 

Q    Are  you  aware  of  memoranda  that  Colonel  North  would 
write  to  the  Office  of  Public  Liaison  or  White  House  counsel 
in  connection  with  coordinating  these  briefings? 


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A    I  don't  have  a  specific  recollection  of  any 
documents  like  that  right  now. 

Q    What  about  one-on-one  meetings  between  contributors 
to  NEPL  and  President  Reagan? 

A    Well,  in  regards  to  Mrs.  Newington,  we  provided  to 
the  State  Department  specific  items  of  Mrs.  Newington 's  past 
political  efforts  on  behalf  of  the  president  on  the  issue, 
and  that  became  ultimately  a  McFarlane  memorandum  to  the 
scheduling  office.   And  I  think  the  officer  in  charge-- 
actually  the  officer  on  that  memorandum  was  probably  Colonel 
North. 

Q  And  do  you  recall  having  drafted  a  memorandum  for 
Mr.  McFarlane  to  send  up  the  line  requesting  a  presidential 
one-on-one  meeting  or  photo  -opportunity  with  Mrs.  Newington? 

A    I  drafted  a  fair  amount  of  the  text  of  that 
memorandum  and  a  subsequent  listing  of  her  contributions. 

Q    What  about  other  meetings  that  the  president  had 
one-on-one  or  photo  opportunities  with  NEPL  contributors? 
Did  you  have  a  role  in  coordinating  those  meetings  or  photo 
opportunities? 

A    Well,  my  role  was  that — it  was  an  IBC  responsibility 
to  make  those  things  happen. 

Q    And  who  at  IBC  was  principally  responsible  to  carry 
out  that  IBC  responsibility? 

A          Let's   not   get   into  another  semantic   argument.      I 
IIAlAt    a  ^^ 


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was  principally  responsible,  since  I  am  and  was  the  lead  on 
the  client.  I  used  in  that  endeavor  David  Fisner  and  Marty 
Artiano  and  their  contacts  within  the  White  House  offices. 

Q    What  about  one-on-one  meetings  between  NEPL 
contributors  and  Colonel  North?   Did  you  have  a  role  in 
arranging  those? 

A    Yes.   In  fact,  initially  I  was  the  only  one 
responsible  for  arranging  them  until  late  '86,  when  Dan 
Conrad  attempted  to  insert  himself  in  the  process  and  then 
also  Mr.  Channell.   In  both  instances  it  was  resisted  by 
Colonel  North,  and  there  may  be  a  couple  of  meetings  which 
Mr.  Channell  then  subsequently  set  up,  but  I'm  not  conversant 
with  the  details. 

Q    In  what  period  would  that  have  been  in  which 
Channell  or  Conrad  set  up  meetings  directly  with  North  for 
NEPL  contributors? 

A    It  would  have  to  be  in  late  '86. 

Q    Late  '86. 

A    Yeah.   Okay. 

Q    Is  it  your  understanding  that  every  one-on-one 
between  Colonel  North  and  NEPL  contributors  prior  to  late  '86 
was  arranged  by  you? 

A    Yes. 

Q    Just  off  the  top  of  your  head — I'm  not  asking  you 
to  give  me  an  exhaustive  list — what  NEPL  contributors  do  you 

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recall  having  met  one-on-one  with  Colonel  North? 

A    Barbara  Newington,  Fred  Sacher,  David  and  Paula 
Wurm,  Edmund  Brandon,  Dr.  Marietta  Keywitz,  Barbara  Christian 
Bullitt,  Thomas  Claggett,  Patty  Beck.   That's  all  I  can 
remember  right  now. 

Q    Were  you  involved  in  arranging  the  one-on-one 
meeting  that  Colonel  North  had  in  March  of  1986  with  a 
William  O'Boyle? 

A    Yes.   It  was  one,  as  I  recall,  of  a  series  of 
meetings.   And  the  initial  meeting  was  one  of  that  series, 
and  I'm  the  one  that  arranged  the  series  with  Fawn  on  Colonel 
North's  schedule. 

Q    Did  you  tend  to  arrange  one-on-one  meetings  with 
Colonel  North  following  the  briefings  to  which  we  have 
referred? 

A    I'll  accept  the  word  "tend",  because  generally  what 
would  happen  is  that  after  Mr.  Channell  had  the  day's  program 
and  the  evening  dinner  that  it  was  associated  with  the 
Central  American  Freedom  Program,  he  would  have  then  identi- 
fied anywhere  from  one  to  six  or  seven  people  who  wanted  to 
participate  in  the  assistance  effort.   And  those  were  the 
individuals  that  were  then  scheduled  to  see  Colonel  North. 

There  were,  however,  other  meetings  which  had 
nothing  to  do  with  events  here  in  Washington,   more  general 
Central  American  freedom  program  briefings,  such  as  the 

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meeting  with  Mrs.  Newington  in  Connecticut. 

Q    You're  talking  about  the  weekend  trip,  okay.   We'll 
get  to  that  in  a  minute. 

Back  on  June  2  3rd,  where  you  covered  your  knowledge 
of  solicitations  of  Mr.  Ramsey  and  Mrs.  Newington,  and  then 
earlier  today  we  covered  a  couple  of  additional  notes  about 
the  Ramsey  solicitation  in  June  of  '85,  and  the  subsequent 
mailgram  that  went  out  to  Mr.  Channell. 

In  connection  with  the  Newington  solicitation  in 
November  of  1985,  about  which  you  previously  testified,  I  am 
going  to  ask  the  reporter  to  mark  as  Exhibit  18  a  copy  of  a 
set  of  handwritten  notes,  and  ask  you  if  you  can  identify 
those  notes? 

A    Yes,  they  are  ray  handwritten  notes. 

(Exhibit  No.  18  was  marked  for 
identification. ) 
BY  MR.  KAPLAN: 
.  Q    Were  these  notes  written  in  preparation  for  the 
solicitation  of  Mrs.  Newington? 
A    Yes. 

Q    Can  you  explain  the  circumstances  of  the  context  in 
which  these  notes  were  written? 

A    These  were  the  precise  things  that  Spitz  Channell 
wanted  Colonel  North  to  say  to  Mrs.  Newington. 

Q    The  amount  that's  listed  at  the  top  of  the  page  is 


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$1.2,  is  that  correct? 

A    Correct. 

Q    Was  that  the  amount  for  which  you  understood  Mrs . 
Newington  was  going  to  be  solicited? 

A    Yes. 

Q    Was  she  in  fact  solicited  for  that  amount? 

A    I  think  at  this  point  she  had  actually  already  been 
solicited  to  some  degree,  and  I  think  she  had  made  this 
commitment  to  Mr.  Channell,  or  was  about  to  make  this 
commitment  to  Mr.  Channell. 

(Witness  and  attorney  consult.) 

THE  WITNESS:   There's  a  squiggle  line  down  through 
the  middle  of  the  page  that  goes  to  November  1,  January  1, 
February  1.   And  the  reason  . I  said  what  1  just  said  to  you  is 
I  don't  recall  whether  that  was  written  at  the  same  time 
these  other  items  were  written  down. 
BY  MR.  KAPLAN: 

Q    I  see. 

A    And  that  may  well  be  the  reflection  of  a  later 
conversation  with  Mr.  Channell. 

Q    So  it  could  well  be  that  the  actual  amount  and  the 
breakdown  of  $400  times  three  was  written  sometime  after  this 
solicitation  to  which  you  testified  on  June  23rd  and  referred 
to  earlier  today? 

A    It's  possible  that  those  three  items  listed  as 

IIMni  AOOinrn 


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November  1,  January  1,  and  February  1,  each  for  $400,000,  may 
have  been  written  at  a  different  time. 

Q    When  we  say  a  different  time,  we're  talking  about  a 
different  time  from  the  notes  that  are  on  the  bottom  half  of 
the  page? 

A    Correct . 

I  think  you  only  used  the  word  "possible,  "  and  I 
want  your  record  to  reflect  that.   I'm  really  not  that  clear. 

MR.  DUDLEY:   I  think  you  misspoke.   You  charac- 
terized that  word  as  November  1,  when  I  believe  the  word  is 
"now. " 

BY  MR.  KAPLAN: 

Q    Can  you  read  into  the  record,  Mr.  Miller,  the 
handwriting  on  the  bottom  o£  the  page  that  starts  with  the 
word  "green"? 

A    It's  "Green  dash  now  working  a  year  on  this 
program. " 

Second  item,  "most  secure  person  we  know  in  the 
U.S." 

Third  item,  "We  are  asking  you  to  take  on  a  project 
that  requires  your  kind  of  person." 

Q    Now,  do  you  recall  the  circumstances  under  the 
contact  in  which  those  notes  were  written? 

A    Those  were  elements  of  a  conversation  that  Mr. 
Channell  hoped  Colonel  North  would  have  with  Mrs.  Newington. 


iiMOi  Aooinrn 


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Q    And  this  conversation  between  you  and  Channell  took 
place  prior  to  the  Newington  solicitation? 
A    Correct. 

Q    I  take  it  the  green  refers  to  Colonel  North? 
A    Correct. 
Q    Did  you  relay  this  proposed  pitch,  if  you  will,  to 

North? 

A    I  don't  recall  relaying  it  to  him,  and  I  don't 

recall  him  using  it. 

Q    Is  it  possible  that  you  relayed  this  pitch  to  North 
in  a  bit  softened  form? 

A    That's  possible.   But  again  I  don't  have  a  specific 
recollection  of  a  conversation  with  him. 

Q    You  testified  a  moment  ago  as  to  a  weekend  trip  to 
Mrs.  Newington' s. 

Do  you  recall  when  that  trip  took  place? 

A    Not  specifically.   I  remember  it  was  chilly,  and  I 
donit  think  there  were  a  lot  of  leaves  on  the  trees.   That's 
about  the  best  I  can  do  to  give  you  a  specific  time.   I  don't 
have  it  in  my  calendar. 

Q    Who  accompanied  you  on  that  trip? 

A    Colonel  North,  his  wife  Betsy,  his  son,  and  his 
youngest  daughter. 

Q    How  did  you  make  the  travel  to  Mrs.  Newington 's  in 

Connecticut? 


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A    We  went  by  chartered  jet. 

Q    Who  paid  for  the  jet? 

A    I  assumed  it  was  Mrs.  Newington  or  Mr.  Channell,  I 
don't  know  which. 

Q    What  was  the  purpose  of  that  visit? 

A    It  was  billed  to  both  Colonel  North  and  myself  as  a 
picnic  at  Mrs.  Newington's,  a  chance  for  Colonel  North  to  get 
away.   He  was,  by  everybody  who  saw  him's  account,  fairly 
frazzled  and  exhausted,  and  it  was  billed  as  an  opportunity 
for  him  to  relax  and  be  with  his  wife  and  children. 

Q    Was  Mrs.  Newington  solicited  funds  during  that 
weekend? 

A    Yes. 

Q     By  whom? 

A    By  Mr.  Channell. 

Q    Was  that  solicitation  in  Colonel  North's  presence? 

A    It  began  somewhat  in  Colonel  North's  presence. 
_  Q    Do  you  want  to  just  describe  it? 

A    Yes .   We  had  been  there  a  day .   I  think  we ' d 
finished  —  we  had  dinner  the  night  before  and  slept  the 
night  and  had  breakfast  the  next  morning.   And  Ollie  was 
sitting  out  on  the  porch  area  by  the  pool,  just  kind  of 
relaxing.   And  Spitz  asked  me  to  come  with. and  Barbara 
Newington  over  to  the  place  where  Colonel  North  was  sitting. 
And  he  asked  Colonel  North  to  give  Barbara  a  description  of 


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the  way  things  were  going  on  the  ground  in  Nicaragua. 

I  got  the  feeling  that  he  was  somewhat  disturbed  by 
having  to  do  that.   He  didn't  really  think  that  to  be  the 
purpose  of  his  being  there.   But  he  agreed  to  do  it,  and 
described  to  her  the  general  situation  on  the  ground  for  the 
resistance  fighters. 

And  Spitz  then  asked  Ollie  what  it  is  going  to  take 
for  the  next  —  I've  forgotten  how  many  months  —  how  much 
does  it  cost  a  month  to  keep  their  operation  going?   And 
Ollie 's  response  was  $2  million.   And  at  that  point  he  was 
beginning  to  be  agitated,  and  he  simply  got  up  and  kind  of 
walked  away.   It  was  clear  to  me  that  he  did  not  want  to  be 
put  in  the  position  he  had  just  been  put  in. 

And  then  Mr.  Channell  asked  Barbara  Newington  to 
please  help.   And  she  agreed. 

Q    Tell  me  what  you  know  about  a  solicitation  of 
Nelson  Bunker  Hunt  that  occurred  sometime  in  early  September 

1985. 

A    Mr.  Channell  had  gotten  a  contribution  from  Mr. 
Hunt  somewhere  in  the  neighborhood  of  $475,000.   But  it  was  a 
little  unusual.   It  had  come  as  a  2  30  some  thousand  dollar 
contribution,  and  then  a  like  amount  as  a  loan.   And  the  way 
it  was  left  with  Mr.  Hunt  was  that  that  was  a  loan  so  Mr. 
Channell  could  use  that  money  while  he  raised  money  from 
other  people  to  repay  it. 


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Mr.  Channell  didn't  believe  in  spending  money  he 
didn't  have  in  the  bank,  and  he  didn't  believe  in  going  into 
debt  in  fund  raising  so  he  refused  to  spend  that  money  and  he 
kept  it  in  the  bank. 

Then  Mr.  Channell  asked  that  I  call  Colonel  North 
and  ask  him  to  call  Bunker  Hunt,  and  to  explain  to  him  that 
the  22  hundred  and  30  some  thousand  dollars  had  gotten  where 
it  was  supposed  to  go,  and  that  specifically  that  the 
supplies  were  getting  to  the  Nicaraguan  resistance. 

I  think  that  Mr.  Hunt  was  under  the  impression  that 
he  had  given  money  for  aerial  supply  operations. 

Q    Were  you  aware  that  Colonel  North  had  flown  to 
Dallas  to  meet  with  Mr.  Hunt  sometime  prior  to  Mr.  Hunt's 
having  committed  the  $475, OCM)  as  a  part  loan,  part  contribu- 
tion to  NEPL7 

A    I'm  aware  that  Spitz  Channell  and  Ollie  North  met 
with  Mr.  Hunt  at  a  dinner  in  Dallas  that  was  for  resistance 
figures  from  around  the  world.   I've  forgotten  who  the  actual 
sponsor  was,  but  it  was  a  political  event  which  several 
hundred  people  went. 

Q    Are  you  aware  that  at  or  around  that  time  Channell 
solicited  Hunt  for  the  money  that  resulted  in  the  237.5 
contribution  and  the  237.5  loan? 

A    Until  you  mentioned  it  just  now,  I  had  never  put 
two  and  two  together,  but  you're  probably  right. 


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Q  I  am  going  to  show  you  a  copy  of  what  has  already 
been  marked  as  Deposition  Exhibit  No.  6.  It's  a  note  which 
you've  testified  before  is  dated  9/18/85,  that  is  September 
18,  1985. 

The  number  two  item  on  that  note  says  "Green  is  to 
call  Bunker. " 

To  the  best  of  your  recollection,  is  that  the  phone 
call  to  which  you  were  just  referring? 
A    Yes. 
Q    And  No.  4  on  that  note  says  "Reagan  thank  you." 

Does  that  refer  to  the  contribution  and  loan  that 
you  understood  Hunt  to  have  made? 

A    No.   I  think  that's  a  thank  you  to  Spitz  Channell. 
Q    Okay.   No.  3  on  the  list,  which  is  crossed  out, 
says  "Bunker  with  RR  call  or"  —  and  I  can't  read  the  last  — 
"call  or  visit,"  I  think  it  says. 

Do  you  recall  what  the  source  of  that  note  is  and 
why  it's  crossed  out? 

A    These  are  all  things  that  Mr.  Channell  wanted.   He 
wanted  Bunker  to  have  a  meeting  with  the  President  or  call 
from  the  President. 

Q    Did  you  take  any  action  to  get  Mr.  Hunt  a  meeting 
with  the  President  or  a  call  from  the  President? 

A    On  this  specific  request,  I  don't  think  I  took  any 
action  because  there's  a  line  drawn  through  it.   And  that 


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usually  means  that  I  just  —  it's  something  out  of  hand  or, 
for  one  reason  or  another,  I  just  didn't  do  it. 

Q    And  then  you  testified  that  Nos .  7,  8  and  9  were 
probably  written  at  some  time  different  than  Nos.  1  through  6 
on  that  note. 

A    That's  correct. 

Q    And  7,  8  and  9  — 

A    They're  in  different  colored  ink  even  on  the 
original . 

Q    And  7,  8  and  9  were  written  in  connection  with  a 
phone  conversation  I  believe  that  you  were  having  with 
Colonel  North,  is  that  correct? 

A    I  don't  think  it  was  a  phone  conversation.   It  was 
a  conversation  nonetheless.  - 

Q    Was  it  a  meeting,  a  face-to-face  meeting? 

A    It  may  have  been,  but  it  was  a  conversation. 

Q  Okay.   I  believe  it  is  also  accurate  to  say  that 

the. entries  7  and  8,  one  of  which  refers  to  weapons,  and  the 
other  which  refers  to  Maule  aircraft,  I  believe,  were,  at 
least  to  your  knowledge,  items  provided  to  you  by  North  with 
his  knowledge  that  those  items  likely  would  be  used  by 
Channell  in  fund  raising  for  the  contras? 

I  didn't  mean  to  confuse  you  there.   I'm  just 
trying  to  sum  up  your  prior  testimony  without  having  to  take 


you  through  it  again. 


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A    Well,  let  me  give  it  to  you  just  very  short  and 
sweet . 

Those  were  items  that  I  discussed  with  Colonel 
North  when  Mr.  Channell  was  trying  to  identify  big  ticket 
items  for  which  he  could  raise  funds. 

Q    Colonel  North  understood  that  these  items  and  these 
prices  would  be  used  by  Channell  in  connection  with  his  fund 
raising  efforts  on  behalf  of  the  contras,  is  that  correct? 

A    These  were  items  in  a  discussion  about  that.   I 
don't  know  that  we  ever  came, —  I  know  that  the  Maule  became 
something  which  we  raised  money  for.   We  never  raised  415,000 
specifically  for  weapons,  C4s  and  M17s. 

Q    But,  nonetheless,  again  I'm  not  trying  to  trick 
you.   I 'think  you  testified  -about  this  before. 

Nonetheless,  when  North  provided  you  with  these  big 
ticket  items,  he  understood  the  reason  why  he  was  giving  you 
big  ticket  items  was  for  Channell  to  use  in  fund  raising? 
-  A    That's  correct. 

Q    Mr.  Miller,  do  you  recall  — 

MR.  DUDLEY:   Can  we  go  off  the  record  a  minute? 
MR.  KAPLAN:   Sure. 
(Brief  discussion  off  the  record.) 
MR.  DUDLEY:   With  respect  to  the  basis  of  the 
discussion  off  the  record,  we  have  agreed  that,  with  respect 
to  Deposition  Exhibit  6,  which  is  a  document  produced  by  us 


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in  response  to  subpoena,  our  date  stamp  number  is  004375,  and 
the  Committee's  document  identification  number  RM000971,  that 
that  portion  of  that  page,  after  the  first  nine  items,  and 
beginning  9/20/85,  is  material  that  relates  to  clients  of  IBC 
other  than  anything  —  it  had  nothing  to  do  with  this 
investigation,  and  that  we  will  supply  the  Committee  with  a 
redacted  version  of  this  document  for  purposes  of  attachment 
to  the  deposition  and  for  purposes  of  the  Committee's 
permanent  records .   And  we  had  intended  to  redact  that 
material  at  the  time  of  production. 

MR.  KAPLAN:   And  I  will  just  state  for  the  record 
that  on  behalf  of  the  Senate  Committee,  and  I  am  sure  I  speak 
for  Mr.  Fryman  on  behalf  of  the  House  Committee,  we  will  make 
all  best  efforts  to  make  sure  that  the  properly  redacted 
version  does  indeed  replace  the  version  with  which  we've  been 
supplied  to  date.   I  only  caution  that  we  can't  guarantee 
every  single  copy  that  might  have  been  made  in  the  process  of 
the- months  of  investigation  that  have  preceded  after  produc- 
tion of  this  document . 

MR.  DUDLEY:   I  understand  that,  but  I  appreciate 
your  willing  to  supply  right  now. 

BY  MR.  KAPLANS 
Q    Mr.  Miller,  do  you  recall  a  time  in  January  of  1986 
when  Mr.  Channell  returned  an  intended  loan^of  $237,500  to 
Bunker  Hunt? 


uNtuissra 


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■Mum  MPOKTWO  CO..  MC. 
)07CSmtt.  NE                25 
Wukiniroo.  0  C     20002 
(2021  W-t«i6 


UNCUSSIHED 


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A    Actually  I  think  Bunker  Hunt  forgave  the  loan.   So, 
in  effect,  he  made  two  contributions. 
Q    That's  your  understanding? 
A    Right. 
Q    How  did  you  arrive  at  that  understanding? 

A    I  believe  Mr.  Channell  told  me  so. 

Q  And  do  you  recall  a  phone  conversation  with  Colonel 
North  in  early  January  in  which  you  told  him  that  Bunker  Hunt 
promised  $237,000? 

A  I  don't  recall  it,  but  it's  entirely  possible.  I'm 
sure  I  reported  the  results  of  his  phone  call  to  him. 

Q    This  would  have  been  several  months  after  that 
phone  call  I  take  it? 

A    I  don't  think  any  -of  this  moved  very  quickly.   I 
think  it  took  a  fairly  long  period  of  time. 

Q    Did  you  ever  participate  in  obtaining  a  letter  from 
the  President  to  be  sent  to  Mr.  Hunt  thanking  him  for  his 
support  without  expressly  mentioning  the  money  contribution? 

A    I  believe  Mr.  Hunt  was  one  of  the  individuals  who 
got  letters,  general  thank  you  letters  for  their  participation 
in  the  Central  American  Freedom  Program.   And  those  names 
would  have  been  provided  to  me  by  Mr.  Channell. 

Q    How  would  you  go  about  obtaining  letters  or  making 
sure  the  letters  got  sent  from  the  President  to  the  various 
NEPL  contributors  as. Channell  requested? 


iiNPiAQQinpn 


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Haifn  nronnta  Co..  mc 
)07  C  Smct.  N.E.  25 

Vahiiifiaa,  DC.    20002 
(202)M«.«M< 


A    We  would  draft  a  potential  letter,  submit  the  names 
generally  to  Colonel  North.   As  you  were  asking  your  question, 
I  was  trying  to  remember  whether  there  was  anybody  else  that 
we  sent  requests  to  when  we  may  have  sent  requests  to  the 
President's  special  message  list.   There's  an  office  that's 
associated  with  the  White  House  that  handles  these  types  of 
letters  of  thank  you  to  people. 

Q    Was  North  generally  the  switching  point  for  these 
letters  from  the  President  to  the  NEPL  contributors? 

A    Yes. 

Q    Did  you  also,  on  a  number  of  occasions,  draft  thank 
you  letters  from  North  to  those  same  or  other  NEPL  con- 
tributors? 

A    Yes . 

Q    Did  Mr.  Fischer  or  Mr.  Artiano  play  a  role  in 
obtaining  letters  from  the  President  to  NEPL  contributors? 

A    I  don't  recall  any  specific  instances  when  they  did. 

Q    So  it  was  all  done  through  you  and  through  Colonel 
North,  and  then  whatever  else  had  to  be  done  in  order  to  have 
the  President  sign  the  letter  and  send  it  to  a  contributor? 

A    That's  correct. 

Q    Do  you  recall  attending  any  NEPL  dinners  in  which 
Mr.  Channell  showed  to  NEPL  contributor  or  potential  con- 
tributors letters  he  had  received  from  President  Reagan 
thanking  him  for  his  support? 


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MUCK  mpomma  co..  mc. 

WTCScrtr..  NE  25 

Vuhiniloa.  0  C      20002 
(202)  M6-MM 


DNCUSSIFIED 


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Q    Was  that  something  that  he  generally  did? 

A    Yes.   Not  just  at  dinners  but  in  solicitations. 

Q    Is  it  fair  to  say  that  Channell  used  these  letters 
for  fund  raising  purposes? 

A    I  think  it's  legitimate  to  say  that  Channel  used 
them  as  evidence  of  his  past  programs.   They  were  all 
retrospective  letters  thanking  him  for  past  programs  which  he 
had  funded  and  executed. 

Q    Then  he  did  use  the  letters  at  these  dinners  that 
often  would  follow  the  briefings  and,  as  you  just  mentioned, 
in  solicitations  of  particular  individuals? 

A    Well,  what  he  would  do  is  he  would  take  the  letters 
and  make  them  part  of  a  general  package  of  information  that 
the  people  would  have  at  their  seats .   And  the  package  would 
also  contain  documents  about  the  Soviet-Cuban  military 
buildup,  of  terrorism  activity  by  the  Nicaraguans,  a  map  of 
Nicaragua.   In  one  instance,  we  put  a  book  from  a  New  York 
Times  reporter  in  there. 

But  he  would  put  these  letters  that  were  thank  yous 
for  past  programs  in  the  same  packages. 

Q    How  did  Channell  come  by  these  letters?  Was  it  the 
same  process  by  which  you  worked  getting  letters  to  NEPL 
contributors  from  the  President?   Would  Channell  make  a 
request  to  you  for  a  thank  you  letter  from  the  President  and 


264 


UNCLASSIFIED 


261 


1  you  would  then  convey  that  to  North  who  would  then  work  it  up 

2  through  the  White  House  channels  and  eventually  get  the 

3  letter  issued? 

4  A    There  were  a  couple  of  instances  in  which  it  was 

5  done  that  way.   But  often  it  was  just  because  somebody  at  the 

6  White  House  properly  triggered  it,  the  Political  Office  saw 

7  the  ads  on  television,  or  Channell  was  asked  to  come  and 

8  participate  in  a  meeting  at  the  White  House  in  which  people 

9  were  asked  to  help  on  the  issue,  that  type  of  thing. 

10  Q    Is  it  possible  that  North  would  have  triggered 

11  thank  you  letters  to  Channell  or  to  other  individuals  without 

12  your  knowledge? 

13  A    Sure. 

14  Q    Tell  me  what  you  know  about  the  solicitation  of  Mr. 

15  0' Boyle  in  late  March  of  1986. 

16  A    I  know  very  little  about  it.   All  I  know  is  that  he 

17  was  brought  down  by  Jane  McLaughlin,  and  that  his  first 

18  contribution  was  $100,000.   That's  all  I  know. 

19  Q    Is  it  possible  that  his  first  contribution  was 

20  $130,000? 

21  A    Possible.   I  think  there's  a  commission  paid  to 

22  somebody  in  there.   I'm  not  sure. 

2  3       Q    Did  you  arrange  the  one  on  one  meeting  between 

24  0' Boyle  and  North  or  the  series  of  meetings? 

HLif*  ntromma  CO..  inc. 

»7csimt.NE    25       A    well,  again,  I  think  the  first  one  was  one  of 

Wuhioitofl.  O  C      lOOOi 


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mUMK  NCMMTWO  CO..  INC. 
>07  C  Sliwt.  N  E  25 

Vuhinfioo.  O  C      :0002 
(2021  V«<-4tt« 


UNCLASSIFIED 


262 


several  meetings  that  took  place  over  the  course  of  an 
evening  and  the  next  morning.   I  don't  want  to  say  evening  or 
next  morning.   Anyway,  after  the  next  day  after  Channell's 
Central  American  Freedom  Program  briefing  and  dinner  that 
evening,  there  were  meetings  with  Colonel  North  one  on  one 
with  people  who  wanted  to  provide  assistance  money.   And  he 
was  one  of  them  I  think. 

Q         When  was  that  meeting  arranged  if  you  can  recall? 

A    I  don't  recall  specifically. 

Q    Was  it  prior  to  the  briefing? 

A    I  don't  think  so.   I  think  it  was  after  the 
briefing. 

Q    Do  you  think  it  was  at  the  dinner  after  the 
briefing? 

A    I  think  it  was  after  the  dinner  after  the  briefing. 

Q    Who  asked  you  to  arrange  that  meeting? 

A    Channel 1. 

Q    Channell  did. 

Tell  us  what  you  know  about  the  solicitation  of 
Mrs.  Garwood  that  occurred  in  April  of  1986,  if  you  know 
anything? 

A    I  don't  know  anything  about  it.   When  was  it? 

Q    April  of  1986. 

A    I'm  not  familiar  with  it. 

I  can't  say  that  I  don't  know  anything  about  it.   I 

iiMPi  Accincn 


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V)7CSawt.  NE.  25 

Vuhiaitoo.  DC.    2000] 


UNCUSSIFIED 


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think  Mr.  Channell  told  me  that  Mrs.  Newington,  or  Mrs. 
Garwood  was  giving  a  million  something,  I  think  it  was  a 
million  and  a  half.   And  I  recall  that  I  got  a  phone  call 
from  him  about  it,  but  I  don't  recall  much  more  than  that. 

MR.  MILLER:   I  was  not  there.   I  was  here  in 
Washington. 

BY  MR.  KAPLAN: 

Q    I  think  when  we  went  off  the  record,  we  were  in  the 
middle  of  an  answer  that  you  were  giving.   I  had  asked  you 
what  your  knowledge  was  of  an  April  1986  solicitation  of  Mrs. 
Garwood . 

A    I  think  I  had  finished  the  answer. 

Q    Do  you  recall  anything  about  the  solicitation  of  a 
Mr.  C.  Thomas  Claggett? 

A    Yes .   I  sat  in  the  room  with  Colonel  North  and 
Spitz  Channell  and  somebody  else.   I  can't  remember  who  the 
somebody  else  is.   It  may  have  been  Chris  Littledale  or  Chris 
Smith.   And  Colonel  North  described  to  them  what  was  going  on 
down  in  Nicaragua  in  terms  of  battlefield  activities.   I 
think  he  even  got  up  and  showed  them  a  map. 

I  don't  think  I  stayed  for  the  whole  meeting. 
Either  that,  or  according  to  the  press  reports,  Mr.  Claggett 
and  I  went  to  two  different  meetings. 

Q     Did  you  arrange  the  meeting  between  Colonel  North 
and  Mr.  Claggett? 


UNCUSSIFIED 


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507  C  Siretl.  N  E  25 

Wiahmiioo.  D  C      20002 
1202)  S46-66M 


jlb264 


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A  Yes. 

Q    Were  weapons  discussed  in  your  presence  at  that 
meeting? 

A    I  don't  recall  weapons  being  discussed  at  that 
meeting. 

Q    Let's  go  back  and  clarify  the  record  on  one  point. 
It  seems  that  you  and  I  have  a  different  view  semantically  of 
the  word  solicitation  and  that  you  view  solicitation  in  what 
may  well  be  a  proper  fashion — the  dictionary  definition  of 
when  did  someone  ask  for  money.   And  I  have  been  speaking  of 
the  term  solicitation  as  sort  the  overall  transaction  without 
any  particular  purpose  other  than  as  a  shorthand. 

I  think  that's  what  gave  rise  to  the  difference  we 
had  as  to  any  testimony  you  -gave  today  was  supportive  of  or 
possibly  inconsistent  with  testimony  you  gave  back  on  June  23 
with  respect  to  the  transaction  by  which  Mrs .  Newington 
eventually  was  solicited  for  funds  for  some  lethal  supplies. 
Is  it  fair  to  say  that  you  stand  by  the  testimony 
that  I  read  to  you  from  June  2  3? 
A    Yes. 

Q    And  is  it  fair  to  say  that  Colonel  North  was 
present  in  the  room  and  indeed  participated  in  a  discussion 
with  Mrs.  Newington  about  lethal  supplies  that  were  needed  by 
the  contras? 


Yes. 


UNCIASSIHED 


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(202)  )4«-M6« 


UHClASSIHffl 


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Q    Just  to  make  the  record  complete,  as  part  of  your 
standing  by  your  testimony  on  June  23,  in  that  testimony  I 
believe  you  stated  that  you  didn't  recall  specifically 
whether  Colonel  North  was  in  the  room  when  Channel 1  asked 
Mrs.  Newington  for  money  to  provide  those  supplies.   Is  that 
correct? 

A    That  is  correct. 

Q    And  I  believe  you  further  testified  in  that  regard 
that  if  he  was  absent  from  the  room,  that  would  not  have  been 
unusual  because  it  was  his  general  practice  to  leave  the  room 
before  Channell  actually  asked  a  contributor  to  pay  over 
funds . 

A    That's  correct. 

Q    Then  we  are  in  complete  agreement  as  to  what  your 
testimony  was  then  and  is  now.   I  apologize  if  my  use  of  the 
term  solicitation  threw  you  off  in  any  way. 

A    No  apology  necessary. 

Q    Thank  you. 

Are  you  aware  of  any  arms  list  or  purchase  list  other 
than  the  big-ticket  items  list  that  you  have  described  before 
that  was  used  by  Channell  in  his  solicitation  or  fundraising 
from  certain  individuals? 

[Witness  and  attorney  consult  and  brief  recess] 
MR.  DUDLEY:   Could  we  just  have  the  question  again 
to  make  sure  we  got  it  dn-iljind? 


iiNCi  hmm 


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n021  %4^6<i6* 


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<Pending  question  read  back> 
MR.  MILLER:   Yes. 

MR.  KAPLAN!   Could  you  describe  the  list? 
MR.  MILLER;   I  was  shown  by  the  independent  counsel 
some  time  in  May — early  May — a  list  that  Mr.  Channel 1  had 
used  to  solicit  John  Ramsey  for  a  contribution,  and  it  was  a 
Spanish-language  list  of  captured  armaments  captured  by  the 
Nicaraguan  resistance  forces.   And  Mr.  Channell  in  his  letter 
to  Mr.  Ramsey  held  it  out  as  a  list  provided  to  him  by  Adolf o 
Calero  of  weapons  needs. 

That  was  the  first  time  I  saw  it  used  in  that 
context.   I  am  quite  familiar  with  the  list  that  came  up  of 
captured  articles.   It  is  one  way  that  the  Nicaraguans  report 
to  the  media  and  Congress  and  the  administration  about  their 
level  of  battlefield  success. 

MR.  KAPLAN:   I'm  going  to  ask  the  reporter  to  mark 
as  Exhibit  19  a  copy  of  a  handwritten  document  that  was 
provided  to  us  by  your  counsel . 

[The  document  referred  to  was 
marked  for  identification  as 
Miller  Deposition  Exhibit  No. 
19.] 
BY  MR.  KAPALN: 
Q    I  ask  you  if  you  recognize  that  handwriting. 
A    Yes.   It's  my  handwriting. 


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107  C  Stmt,  NE  25 

Wuhin(n>o.  O  C     2000] 


jlb267 


UNCussm 


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Q    Do  you  recall  the  circumstances  under  which  these 
notes  were  made? 

A    They  were  to-do  items.   I  think  most  of  them  are 
reflective — maybe  all  of  them — but  at  least  most  of  them  are 
reflective  of  a  conversation  with  Channell  or  Dan  Conrad,  and 
I'm  not  sure  which  one. 

Q    You  see  item  number  one  in  this  note  which  is  dated 
February  5,  1986  reads,  "Ollie's  new  purchase  list". 

A    Yes . 

Q    Do  you  recall  what  that  notation  refers  to? 

A    Yeah.   I  think  that  refers  to  the  fact  that  Mr. 
Channell  felt  that  he  had  fulfilled  the  big-ticket  item  list 
that  had  been  provided  to  him  and  that  there  was  a  need  for  a 
new  purchase  list. 

Q    Did  you  ever  speak  to  North  to  provide  you  with  a 
new  purchase  list? 

A    I  don't  at  the  moment  recall  whether  I  had  a 
spefific  conversation  with  him,  but  I  don't  think  we  ever 
produced  a  new  purchase  list. 

Q    Did  North  ever  provide  you  items  along  the  lines  of 
the  earlier  exhibit  we  discussed  for  Channell 's  use  in 
fundraising? 

A    Did  Colonel  North  ever  provide — 

Q    Did  he  ever  provide  you  with  prices  and  items 
subsequent  to  this  date  that  Channell  couid,use  in  his 


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507  C  Siicn.  N  E.  25 

Waihinroo.  D  C.     20002 
(202)  V«».M«« 


jlb268 


UNCUSSIFIED 


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f undraising? 

A    Not  subsequent  to. 

Q     Just  very  quickly--numbers  four  and  five  refer  to  a 
dinner  for  Newington  "...  and  Ollie  at  the  Newington/RR 
meeting. "   Do  you  know  what  those  notes  refer  to? 

A    Spitz  wanted  to  have  a  dinner  for  Mrs.  Newington 
honoring  Mrs.  Newington,  and  he  wanted  Colonel  North  to 
attend  Mrs.  Newington 's  meeting  with  the  president. 

Q    Did  that  meeting  come  about? 

A    Mrs.  Newington  had  two  meetings  with  the  president. 

Q     One,  I  take  it,  was  in  November  of  1985. 

A    Yes,  I  believe  that's  correct. 

Q    And  was  the  other  one  subsequent  to  this  note? 

A    I  believe  so,  yes.- 

Q    And  was  it  set  up  pursuant  to  Channell's  request  as 
reflected  by  this  note? 

A    It  was  set  up  pursuant  to  Channell's  request.   I'm 
not  sure  if  this  note  is  reflective  of  that.   It  simply-- 
you're  right.   It's  reflective  of  it.   He  had  requested  a 
meeting  with  Mrs.  Newington  and  the  president. 

Q    Just  to  make  sure  I  didn't  miss  anything,  these 
notes — that  is.  Exhibit  19 — were  taken  from  a  conversation 
that  you  had  with  Channell. 

A    Correct. 

Q    What  knowledge,  if  any,  did  you  have  of  a  project  at 


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SOTCSuttt,  NE  25 

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(!021  M6-6<i6« 


jlb269 


UNCLASSIFIED 


269 


NEPL  that  was  called  the  "toys  project"? 

A  Aside  from  the  subsequent  Jane  McLaughlin  charge 
and  Channell  public  response  to  it,  I  don't  have  any  other 
knowledge  of  it. 

Q    So  you  learned  about  the  toys  account  at  the  same 
time  that  the  reading  public  learned  about  it--the  "toys 
project" . 

A    Yeah,  but  again  I  would  think — yes. 

Q    Did  you  learn  about  the  "toys  project"  from  the 
press? 

A    I  learned  eUx>ut  the  use  of  the  words  "toys  project" 
or  "toys  fund"  or  whatever  from  the  press,  but  I  was  aware  of 
a  similar  activity  to  it — an  activity  similar  to  it  earlier. 
And  I  had  heard  the  word  before. 

Q    So  that  during  the  time  that  you  were  engaged  in 
contra  .ssistance  with  NEPL  and  with  Colonel  North,  you  were 
aware  that  NEPL  had  a  project  which  they  designated  funds 
intended  for  the  purchase  of  weaponry  or  lethal  supplies.   Is 
that  what  you're  saying? 

A    No,  that's  not  what  I'm  saying  at  all.   I  knew  that 
there  was  an  effort  around  Christmas  of  1985  by  Mr.  Channell 
to  raise  money  specifically  for  Christmas  for  the  Nicaraguan 
freedom  fighters'  feunilies. 

Q    Did  you  have  any  awareness  that  there  was  a  project 
that  was  called  "toys"  within  NEPL  that  was  considered  by 


IlilAI  lAAl-l— ^ 


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HLLfN  MVOimNO  CO  ,  INC. 
507  C  Su«I.  N  E  25 

Wuhuifion.  D  C      20O02 
(2021  M6-66M 


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people  at  NEPL  to  be  the  project  to  which  contributions 
intended  for  the  purchase  of  lethal  supplies  would  be 
designated? 

A     No. 

Q    When  was  the  Institute  for  North-South  Issues 
created? 

A    I  believe  it  was  started  in  February  of  1984. 

Q     1984? 

A    I  believe  that's  correct. 

Q    Why  was  INSI  created? 

A    It  was  Frank's  belief — Frank  Gomez's  belief — that 
there  needed  to  be  an  organization  that  encouraged  cultural 
and  educational  exchange  between  the  northern  and  southern 
hemispheres  in  that  you  have-  the  wealthier  nations — -the  have 
and  have-not  nations,  the  third  world  and  the  developed  world. 

Q    When  did  Gomez  leave  the  State  Department? 

A    Well,  I  don't  know  when  his  actual  retirement  date 
wasj  but  I  think  it  was  like  the  last  week  in  January--formal 
retirement  was  then. 

Q    Was  INSI  one  of  the  first  projects  in  which  Gomez 
engaged  when  he  left  the  State  Department? 

A    He  set  it  up  fairly  soon  after  leaving  the  State 
Department,  but  it  didn't  even  begin  any  activities  until 
much  later. 

Q    Were  you  involved  in  the  formation  of  INSI? 


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A    I  was  the  treasurer  at  the  formation  of  INSI. 

Q    Did  you  hold  any  other  position  in  INSI  at  any 
other  time  during  its  existence? 

A    I  don't  think  so. 

Q    Do  you  recall  when  INSI  received  a  letter  of 
determination  of  tax  exempt  status  from  the  Internal  Revenue 
Service? 

A    All  I  recall  is  it  took  a  very  long  time  to  receive 
it.   There  was  some  wrangling  between  our  attorneys  and  the 
Service,  and  it  seemed  to  all  hinge  on  procedural  matters  and 
not  substantive  matters.   But  it  ultimately  was  resolved,  and 
we  got--we  actually  got  a  more  restrictive  but  a  better 
status  from  a  tax  point  of  view  than  we  expected  originally. 

Q    Whose  idea  was  INSI? 

A    Frank's. 

Q    Do  you  recall  a  conversation  with  Colonel  North  on 
February  1,  1985  in  which  you  and  he  discussed  INSI? 

A    February  1  of  '85? 

Q    Yes. 

A    We  probably  had  a  discussion  at  that  point. 

Q    Was  INSI  an  idea  of  Mr.  Gomez's  before  he  actually 
retired  from  the  State  Department? 

A    Are  you  saying  February  of  '84? 

Q    No,  February  of  '85. 

MR.  DUDLEY:   I  don't  think  he's  asking  with 


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reference  to  a  date. 

MR.  MILLER:   I  don't  know.   I  think  it  was,  but  I'm 
not  sure.   I  think  you  should  ask  him. 

BY  MR.  KAPLAN: 
Q    Do  you  recall  the  context  in  which  you  would  have-- 
in  which  you  did  discuss  with  Colonel  North  INSI  in  early 
February  of  1985? 

A    My  problem  is  that  he  pegged  it  to  a  specific  date, 
and  I  can  recall  a  couple  of  conversations  with  him  about 
INSI,  and  I'm  not  sure  exactly  what  the  time  frame  was. 

Q    Why  don't  you  just  tell  me  about  those  conversa- 
tions . 

A    He  or  Bob  Earl — I've  forgotten  which — called  one 
time  and  asked  for  a  list  of-  non-profit  organizations 
associated  with  I  think  the  quote  was  "our  side  of  the 
issue" — supporting  the  president  on  Nicaragua.   And  I 
produced  that  list  for  them. 

And  I  would  say  that  was  some  time  prior  to  June  of 
1985,  because  it  only  lists  the  American  Conservative  Trust 
and  doesn't  list  NEPL.   And  INSI  was  on  that  list. 

I  then  also  at  another  time  was  asked  by  Colonel 
North  to  get  in  touch  with  Roy  Godson — that  Godson  had  a 
contributor  who  wanted  to  make  a  contribution  to  the  resis- 
tance.  I  went  and  met  with  Mr.  Godson. 

He  informed  me  that  this  individual  did  not  want  to 


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give  money  to  Spitz  Channell .   He  used  his  name  specifically. 
And  that  this  individual  was  looking  to  provide  money  for 
political  activities. 

I  was  left  with  the  distinct  impression  that  the 
individual  was  interested  in  supporting  the  political 
activities  of  the  resistance. 

Q    I'll  get  to  that  transaction  in  a  moment.   I  want 
to  stick  with  early  1985. 

Do  you  know  why  or  were  you  told  why  Earl  or  North 
asked  for  this  list  of  tax  exempt  organizations  that  were  "on 
your  side"? 

A    Maybe,  but  I  don't  recall  now  what  the  reason  was. 

Q    Who  is  Jimmy  Lyons? 

A    I  don't  really  know.   I  know  he's  a  very  wealthu 
individual  who  is  associated  with  the  conservative  movement. 
That's  about  all  I  know  about  him. 

Q    Did  you  have  discussions  with  Colonel  North  in 
early  1985  in  which  money — in  which  the  idea  of  conveying 
money  for  contra  assistance  through  INSI  was  discussed? 

A    In  what  time  frame? 

Q    Early  1985. 

A    Early  1985.   We  may  have,  in  reference  to--we  may 
have  discussed  it  in  reference  to  al-Masoudi. 

Q    This  would  have  been — I'm  talking  about  a  period 


prior  to  the  al-Masoudi  referral. 


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A    I  don't  recall  any  specific  conversations  about 
using  it  as  a  conduit  for  funds  to  the  Nicaraguan  resistance. 
I  remember  a  general  impression  that  he  had  that  it  could  be 
used,  and  I  was  required  later  to  dissuade  him  on  that.   But 
I  don't  remember  the  specifics  of  how  he  came  to  understand 
that. 

Q    Why  was  North  told  about  INSI  and  its  tax  exempt 
status?   Why  did  you  bring  that  up  in  conversation  with  him? 
Why  would  you  have  brought  that  up  in  conversation  with  him? 

A    I  don't  know.   I  mean,  I  don't  remember  the 
conversation,  so  I  don't  recall  any  elements  of  it. 

Q    Do  you  know  a  Warren  Hendricks? 

A    Yes. 

Q    Who  is  Warren  Hendricks? 

A    Warren  Hendricks  works  for  Clement  Stone. 

Q    Do  you  recall  a  conversation  with  Colonel  North  in 
which  the  names  of  Warren  Hendricks  and  Clement  Stone  were 
discussed? 

A    I  talked  to  Warren  Hendricks  on  one  occasion. 
MR.  DUDLEY:   Don't  think  out  loud;  answer  his 
question. 

MR.  MILLER:   It's  specific  to  his  question,  but  I 
haven't  recalled  it  before  right  now. 

He  was  being  asked  for  money,  and  he  turned  it 
down.   He  didn't  even  talk  to  Clement  Stone  about  it.   He — 


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Hendricks — turned  it  down. 
BY  MR.  KAPLAN: 

Q    What  was  the  purpose  of  the  request  for  the  money, 
if  you  recall? 

A    I  can't  recall. 

Q    Who  asked  him  for  the  money? 

A    I  did.   He  may  have  talked  to  Warren  Hendricks. 

Q    Who  is  he? 

A    North  may  have  talked  to  him.   I'm  sorry.   I'm 
recalling  this  for  the  first  time,  so  it's  sketchy,  at  best. 
It's  a  long  process,  as  you're  aware. 

Q    What  was  the  purpose  of  the  money — contra  assis- 
tance? 

A    It  had  something  to  do  with  the  Nicaraguan  issue, 
as  I  recall. 

Q    And  you  mentioned  earlier  that  there  was  a  time 
when  you  had  to  dissuade  North  from  the  idea  that  INSI  would 
be  used  as  part  of  a  contra  funding  network.   Do  you  want  to 
tell  us  a  bit  about  that? 

A    After  the  second  transaction  through  INSI,  there 
were  two — the  first  for  $100,000,  the  second  for  $60,000.   I 
told  him  that  we  simply  wouldn't  do  it  anymore. 

Q    Again,  back  to  the  time  frame  in  early  1985--was 
there  a  conversation  with  North  that  you  recall  in  which  the 
idea  was  discussed  of  using  INSI  to  funnel  money  to  the 

iumi  toeicicn 


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contras? 

A    Again,  I  don't  have  a  specific  recollection  of  a 
conversation. 

Q    When  Mr.  Hendricks  was  asked  for  money  by  you,  was 
he  asked  to  contribute  to  XNSI? 

A    I  can't  remember  what  the  substance  of  the  contribu- 
tion was.   This  may  all  be  about  the  time  of  the  Nicaraguan 
refugee  fund  dinner  and  when  it  was  being  put  together, 
because  it  really  got  started  in  January.   I  think  the 
meeting  I  attended  was  in  late  January,  and  it  took  until 
February  or  March  for  the  dinner  to  come  off. 

Q  .   Would  money  for  the  Nicaraguan  refugee  fund  dinner 
have  been  solicited  for  contribution  to  INSI? 

A    It  shouldn't  have  been. 

Q    You  have  mentioned  earlier  in  your  testimony  a 
$100,000  contribution  that  was  made  to  INSI  from  the  Heritage 
Foundation.   I'm  going  to  ask  the  reporter  to  mark  as 
Deposition  Exhibit  20  a  copy  of  what  purports  to  be  a  letter 
to  you  from  an  Edwin  J.  Feulner,  president  of  the  Heritage 
Foundation,  dated  October  15,  1985. 

[The  document  referred  to  was 
marked  for  identification  as 
Miller  Deposition  Exhibit  No. 


20.] 


BY  MR.  KAPLAN: 


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Q    Do  you  recognize  this  letter? 

A    Yes. 

Q    Is  this  a  letter  which  evidences  the  $100,000 
contribution  from  the  Heritage  Foundation  to  the  INSI,  about 
which  you  just  testified? 

A    Yes. 

Q    Can  you  tell  us  the  circumstances  under  which  this 
$100,000  was  contributed  to  INSI? 

A    Well,  as  I  testified  earlier,  I  was  contacted  by 
Colonel  North,  who  asked  me  to  get  in  touch  with  Roy  Godson. 
I  called  Mr.  Godson  and  went  to  see  him  in  his  office.   He 
told  me  that  he  had  a  contributor  that  wanted  to  make  a  very 
large  contribution.   I  suggested  that  he  give  him  Mr. 
Channell's  organization  name- — allowed  to  make  the  contribution 
to  Mr.  Channell's  organization. 

He  told  me  that  the  individual  was  not  interested  in 
making  a  contribution  to  Spitz  Channell's  organization  and 
thaJt  he  hoped  there  would  be  some  other  way  the  transaction 
could  be  handled.   I  told  him  I  thought  that  was  possible  but 
that  I  would  have  to  get  back  to  him. 

I  went  back  and  discussed  it  with  Frank  Gomez.   I  told 
Frank  I  didn't  think  it  was  reasonable  for  the  foundation  to 
be  risked  without  some  compensation  to  the  foundation  for  the 
risk  associated  with  it. 

Q    When  you  say  the  foundation,  what  are  you  referring 

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A    Institute  for  North-South  Issues. 

And  Frank  agreed.   I  then  went  to  see  Colonel  North  and 
told  him  that  INSI  could  accept  the  contribution  but  that  it 
would  charge  a  20-percent  overhead  charge  for  administering 
the  grant.   He  agreed  that  that  was  acceptable. 

I  went  back  to  Mr.  Godson  and  told  him  that  his 
donor  could  make  the  contribution  payable  to  the  Institute  for 
North-South  Issues.   I  gave  him  the  name  and  the  address  and 
so  forth,  and  the  next  thing  I  got  was  a  request  for  a 
proposal  from  the  Heritage  Foundation. 

Q    Did  you  understand  the  request  for  a  proposal  to  be 
connected  to  the  Godson  donor? 

A    Yes.   Not  prior  to-  receiving  it,  however. 

Q    How  did  you  make  the  connection  between  the 
Heritage  Foundation  request  for  a  proposal  and  the  Godson 
offer  of  a  contributor? 

A    Same  dollar  amount,  same  time  period,  same  terms  of 
reference . 

Q    Did  you  speak  to  Mr.  Godson? 

A    Probably,  but  I  don't  remember  specifically  after 
that. 

Q    Did  you  know  Mr.  Godson  before  North  referred  you 


to   him? 


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Q    And  did  you  subsequently  make  a  proposal  to  the 
Heritage  Foundation? 

A    I  did. 

Q    Under  the  name  of  INSI? 

A    Correct. 

Q    And  did  the  Heritage  Foundation  subsequently 
approve  your  proposal? 

A    Yes. 

Q    That  approval,  I  take  it,  resulted  in  the  letter 
and  contribution  that's  evidenced  by  Exhibit  20. 

A    That's  correct. 

Q    What  did  INSI  do  with  the  $100,000  contribution? 

A    It  was  transferred  to  IC,  Inc.   Well,  $80,000  was 
transferred  to  IC,  Inc.;  $20-,  000  stayed  in  INSI. 

Q    What  ultimately  happened  to  that  $20,000? 

A    Well,  it  went  into  the  general  account  at  IC,  Inc. 
and  was  used  for  efforts  that  Colonel  North — 

MR.  DUDLEY:   He  asked  about  the  $20,000. 
MR.  MILLER:   Oh,  the  $20,000. 
MR.  KAPLAN:   The  $20,000. 

MR.  MILLER:   It  was  used  for  general  administra- 
tion— salary  for  the  executive  director,  paper,  xeroxing,  and 
all  the  other  things  associated  with  all  of  that. 
BY  MR.  KAPLAN: 

Q    Who  was  the  executive  director? 


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A    At  that  point,  Henry  Quintero. 

Q    And  the  $80,000,  I  take  it,  went  into  the  IC,  Inc. 
account  and  was  disbursed  pursuant  to  instructions  by  Colonel 
North. 

A    Correct. 

MR.  ICAPLAN:  I'm  going  to  ask  that  the  reporter  mark  as 
Exhibit  21  a  copy  of  what  purports  to  be  a  Form  990  that  was 
filed  for  the  tax  year  1985  by  INSI. 

[The  document  referred  to  was 
marked  for  identification  as 
Miller  Deposition  Exhibit  No. 
21.] 
BY  MR.  KAPLAN: 
Q    I'm  going  to  ask  you,  Mr.  Miller,  if  you  can 
identify  this  Form  990. 

A    Yes.   This  is  our  Form  990  filed  for  the  tax  year 

1985. 

Q    And  is  this  Form  990  signed  by  you  on  the  last  page' 

A    Yes,  it  is. 

Q    It's  signed  by  you  in  the  capacity  of  treasurer? 

A    Yes. 

Q    I'm  going  to  direct  your  attention  to  part  3. A.  on 
page  two  of  Exhibit  21  and  ask  you  whether  the  $80,000  listed 
on  the  right-hand  column  of  part  3. A.  is  the  $80,000  that  was 
transferred  to  IC,  Inc.  from  INSI  as  a  result  of  the  $100,000 


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from  the  Heritage  Foundation  about  which  you  just  testified. 

A    It  is. 

Q    And  the  description  of  that  $80,000  reads  that  it 
came  from  the  Heritage  Foundation.   It  describes  the  Heritage 
Foundation,  and  then  it  states  that  "INSI  .  .  ." — and  I'm 
quoting-- "managed  a  grant  by  Heritage  to  produce  a  study  on 
foundation  information  services  in  the  Caribbean  and  Latin 
America."   Is  it  fair  to  say  that  that's  not  an  accurate 
description  of  what  that  $80,000  was  used  by  INSI  for? 

A    It's  fair  to  say  that  that's  not  a  completely 
accurate  characterization  of  what  the  $80,000  was  used  for. 

Q    You  testified  a  bit  earlier  this  afternoon  that  you 
rue  the  day  when  you  wrote  about  five  or  six  words  that  were 
contained  in  your  February  1987  report.   Do  you  also  rue  the 
day  that  you  wrote  that  description  of  what  INSI  did  with 
that  $80,0007 

MR.  DUDLEY:   I  object.   Whether  he  rues  the  day  has 
no  bearing.   What's  the  point  of  a  question  like  that  other 
than  sheer  harassment?   I'm  hoping  that  Mr.  Kaplan  is  going  to 
respond  to  my  inquiry. 

MR.  KAPLAN:   I'm  asking  for  an  answer. 
MR.  DUDLEY:   I  want  to  know  what  the  predicate  for 
the  question  is.   What  is  the  basis  of  a  question — what  is  the 
relevance  of  a  question  about  whether  he  rues  day  he  wrote 
something,  to  this  investigation  or  any  other  investigation; 


imni  Aooinui 


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MR.  KAPLAN:   I  was  just  using  the  witness'  phraseol- 


MR.  DUDLEY:   That's  something  he  said  about  another 
thing,  but  that  doesn't  make  it  relevant  to — 
BY  MR.  KAPLAN: 

Q    Fine.   I  will  withdraw  the  question,  and  I  will  ask 
whether  you  would  describe  what  INSI  did  with  the  Heritage 
Foundation  differently  if  you  had  it  to  do  again  today. 

A    Yes. 

Q    I  really  wasn't  trying  to  harass  you.   I  really 
kind  of  liked  your  turn  of  the  phrase  before. 

Was  there--you  testified  before  about  a  subsequent 
contribution  of  S60,000  that  also  came  through  Mr.  Godson  to 
INSI. 

A    I  believe  it  came  through  Mr.  Godson,  but  it  was 
certainly — I  was  made  aware  of  it  by  either  Mr.  Godson  or  Mr. 
North,  and  frankly  I  can't  recall  which. 
-  Q    And  was  the  $60,000  paid  to  INSI? 

A    Yes . 

Q    Do  you  recall  who  the  contributor  was  in  that 
instance? 

A    It  was  in  our  check  ledger  as  Macaleer,  and  I  have 
asked  the  bank  for  the  cancelled  incoming  check  which  they 
would  have  a  copy  of,  and  they  informed  us  last  week  that 
they  did  not  keep  a  copy  of  it.   Or  rather,  they  have  lost  a 

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jlb283 


nnmim 


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copy  of  it.   So  I  haven't  been  able  to  get  my  hands  on  it. 
You're  not  the  only  people  in  town  that  want  it. 

Q    Do  you  recall  when  that  contribution  was  made? 

A    It  seems  to  me  that  it  was  right  around  the  first 
of  the  year  in  1986. 

Q    Do  you  recall  what  INSI  did  with  that  contribution? 

A    It  transferred  it  immediately  out  to  Lake  Resources. 

Q    Has  INSI  filed  a  Form  990  for  1986? 

A    Yeah. 

Q    Do  you  recall  how  that  $60,000  contribution  that 
was  then  sent  on  to  Lake  Resources  was  treated  on  that  Form 
990? 

A    I  think. it's  been  amended  since  it. was  filed,  and  I 
think  the  amendment  simply  s'tates  that  it  was-  money  for  the 
Nicaraguan  resistance  at  the  direction  of  Lt.  Col.  Oliver 
North. 

Q    Has  there  been  any  attempt  to  amend  the  Form  990 
that's  been  marked  as  Exhibit  21? 

A    No. 

Q    If  it  doesn't  impinge  on  an  attorney-client 
communication,  can  you  tell  us  why  there's  been  no  attempt  at 
amending  that  Form  990? 

[Recess  for  witness  and  attorney  to  consult) 
MR.  KAPLAN:   Can  we  go  back  on  the  record? 
MR.  MILLER:   I  don't  know.   There's  really  no 


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answer  to  your  question.   I  hadn't  thought  about  it,  frankly. 
BY  MK.  KAPLAN: 
Q    When  did  you  first  meet  Adolf o  Calero? 

A    Some  time  in  1984. 

Q    In  what  context  did  you  meet  Mr.  Calero? 

A    Frank  set  up  a  breakfast  between  himself,  Adolf o 
Calero,  and  myself. 

Q    What  was  the  purpose  of  that  breakfast? 

A    To  talk  to  Mr.  Calero  about  the  potential  of  IBC 
representing  him  in  Washington. 

Q    Was  Mr.  Calero  referred  to  within  IBC  by  the  name 
"Spark  Plug"? 

A    Yes. 

Q    Who  coined  that  name? 

A    Frank  did. 

Q    Do  you  recall  the  derivation  of  the  code  name? 

A    Sure . 

Q    Why  don't  you  tell  us  about  it. 

A    Well,  again,  you  try  and  make  it  something  that  has 
some  relevance  to  his  actual  name,  and  his  initials  are  AC, 
and  AC  is  a  spark  plug,  so  that's  why  it  was  "Spark  Plug". 

Q    Was  one  of  the  contra  leaders  referred  to  as 
"Clutch"? 

A    Yes. 

Q    Who  coined  that  name? 


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Wuhui|l<>«    DC      20002 
(2021  M6-6M« 


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A    Well,  since  Mr.  Matamoros  was  part  of  Mr.  Calero's 
organization,  we  just  continued  the  automobile  convention, 
and  he  became  "Clutch". 

Q    Mr.  Matcimoros  was  "Clutch". 

A    That's  correct.   I  think  I  coined  that  one. 

Q    As  a  result  of  the  breakfast  among  you  and  Mr. 
Gomez  and  Mr.  Calero,  did  a  professional  relationship  arise 
between  Mr.  Calero  and  IBC? 

A    Yes. 

Q    what  was  the  nature  of  that  relationship? 

A    We  were  the  media  relations  and  political  consul- 
tants to  the  Nicaraguan  Development  Council,  which  again 
served  the  domestic  interest  of  the  resistance. 

Q    Was  Mr.  Calero  at  that  time  head  of  the  Nicaraguan 
Development  Council? 

A    I  don't  think  you  could  use  the  word  "head".   He 
was  certainly  the  principle  beneficiary,  as  was  his  organiza- 
tion, of  the  Nicaraguan  resistance. 

Q    From  whom  did  IBC  receive  payment  in  connection 
with  those  services? 

A    Primarily  from  Mr.  Calero,  sometimes  from  Mr. 
Mateunoros . 

Q    Was  there  an  agreed-upon  payment  at  the  inception 
of  the  business  relationship? 

A    Yes.   Initially  we  were  jJaad  ■$3 /OOO •  a  month,  and 


iujm  looinrn 


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J07  C  imtt.  N  E  25 

Vukmiion.  D  C      20002 


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then  it  became  clear  that  they  couldn't  follow  through  on  the 
level  of  increasing  activity  that  our  efforts  were  producing 
without  more  administrative  help.   So  we  asked  for  $5,000  a 
month,  and  under  that  contract  we  were  responsible  for 
providing  a  full-time  employee  in  their  office,  the  admini- 
strative details,  the  computer  handling  their  distributions, 
and  so  forth. 

Q    When  did  that  increase  occur? 

A    I  can't  recall  specifically. 

Q    Let's  just  get  a  few  dates  straight.   When  did  the 
business  relationship  begin,  to  the  best  of  your  recollection? 

A    I  want  to  say  September  of  '84. 

Q    Do  you  have  any  recollection  as  to  how  many  months 
into  that  relationship  month-ly  fees  were  raised  and  you  put 
an  employee  full-time  into  their  office? 

A    Some  time  around  the  first  of  the  year,  I  think.   I 
think  I've  shortened  this  time  frame.   I  think  it  was  almost 
a  year.   I  think  it's  about  nine  to  ten  months  worth  of 
activity.   So  it's  probably  somewhat  earlier  in  the  year  than 
September.   And  the  employee — maybe  in  September. 

Q    In  September  of  what  year? 

A    That  would  be  September  of  '84. 

Q    You  testified  a  bit  earlier  about  an  exhibit  which 
was  marked  as  Exhibit  No.  11,  which  is  a  letter  of  authoriza- 
tion from  Mr.  Calero  to  Mr.  Channell  authorizing  Channell  to 


290 


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engage  in  fundraising  on  behalf  of  the  FDN.   Did  you  or 
anyone  at  IBC  or  IBC  itself  receive  a  fee  for  obtaining  that 
letter? 

I  don't  recall  receiving  a  fee. 

From  either  Mr.  Channell  or  anyone  else? 

I  don't  recall  receiving  a  fee  to  obtain  that 


A 

Q 

A 
letter. 
Q 

9   Council? 
10 


How  were  you  paid  by  the  Nicaraguan  Development 


co„ 


507CS«re«>.  NE  25 

Viriuafioa.  0  C     20002 
(202)  m-6iU 


A    Generally  in  traveller's  checks,  although  a  couple 
of  times  we  received  wire  transfers. 

Q    Were  they  traveller's  checks  that  were  given  to  you 
by  Calero? 

A    Yes .   Sometimes  we-  got  them  from  Matamoros ,  but  I 
don't  think  very  many  times. 

Q    Were  they  blank  traveller's  checks? 

A    They  were  totally  blank — just  a  bank  name,  and 
everything  else  on  it  was  blank. 

Q    Do  you  know  why  Calero  didn't  write  the  checks  out 
to  International  Business  Communications  and  sign  them  on  the 
bottom? 

A    No. 

Q    Did  you  ever  ask  him  why? 

A    I  never  asked,  but  my  sense  was  that  most  of  their 
activities  were  cash  activities,  and  a  blank  traveller's 

IIIIAI  lAAiri^n 


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I3DXLH6MM 


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check  is  as  good  as  cash.   And  as  a  consequence,  it  was  safer 
because  it  was  not  something  that  could  be  lost. 

Q    Did  Colonel  North  ever  give  you  any  blank  trav- 
eller's checks? 

A  I  don't  ever  recall  receiving  traveller's  checks 
from  Colonel  North. 

Q    You  mentioned  a  bit  earlier  today  that  Jonathan 
Miller  at  one  time  waved  some  traveller's  check,  I  think,  in 
front  of  Frank  Gomez  as  a  show  of  good  faith  or  something  to 
that  effect. 

A  It  was  in  front  of  the  Nicaraguan  Meskito  Indian 
Leader.  Stedman  Fogath  or  Diego  Wycliff — I  can't  remember 
who  it  was . 

Q    Did  you  have  an  understanding  as  to  where  Jonathan 
Miller  got  those  traveller's  checks? 

A    He  was  in  Colonel  North's  office  suite  at  the  time 
he  did  it.   So  I  assumed  they  came  from  there. 

Q    But  you  yourself  don't  recall  ever  having  received 
from  North  any  traveller's  checks  that  were  provided  to  him 
by  Calero  or  anybody  else? 

A    I  don't  ever  remember  getting  traveller's  checks 
directly  from  Colonel  North.   There  was  one  instance  in  a 
hotel  room  here  in  Washington  where  there  was  an  exchange  of 
traveller's  checks  between  Dr.  Calero  and  Colonel  North,  and 
we  ultimately  got  some  of  those  traveller's  checks.   That's 


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the  only  time  which  that  happened,  that  I  can  recall. 

Q    Can  you  describe  that  incident  in  a  bit  more  detail 
so  that  we  can  have  for  the  record  a  clear  reflection  of  what 
took  place  in  that  hotel  room?   I  guess  you  could  start  out 
by  telling  us  approximately  when  that  exchange  took  place. 

A    Well,  it  was  in  the  evening.   The  exact  date  I'm 
not  sure  of.   It  was  at  the  Henley  Park  Hotel.   I  either  went 
there  with  Colonel  North  or  I  met  Colonel  North  there.   We 
went  to  Mr.  Calero's  room.   Mr.  Calero  had  a  large  envelope 
of  traveller's  checks.   Knowing  what  I  now  know  about  their 
volume,  I'd  say  it  had  to  be  at  least  $20,000  in  traveller's 
checks.   They  had  a  discussion  about  names  that  seemed 
familiar  to  the  two  of  them,  and  I  believe  Mr.  Calero  gave 
the  traveller's  checks  to  Colonel  North. 

And  my  reason  for  being  there  was  that  some  of  those 
checks  were  supposed  to  come  to  me.   And  the  best  recollection 
I  have  is  that  it  was  about  the  time  I  put  Maritsa  Herrera, 
the  little  girl,  in  Children's  Hospital  and  took  the  money 
from  my  account  to  pay  for  that.   It  was  $10,000  to  Children's 
Hospital,  and  that  may  have  been  reimbursement  for  that. 

Q    When  was  that? 

A    It  was  right  about  the  time  of  the  Nicaraguan 
refugee  fund  dinner.   In  fact,  she  was  there  for  the  Nicar- 
aguan refugee  fund  dinner,  and  her  wound  had  not  been 
attended  to.   And  she  was  about  to  lose  her  arm,  and  I 

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guaranteed  her  hospital  stay  to  Children's  Hospital. 
Q    So  that  would  have  been  in  April  of  1985. 
A    That  would  be  about — well,  whenever  the  dinner  was, 
so  April,  I  guess. 

MR.  KAPLAN:   Off  the  record  for  a  quick  minute. 
MR.  KAPLAN:   I'm  going  to  ask  the  reporter  to  mark 
as  Exhibit  22  a  composite  exhibit  which  is  comprised  of 
several  traveller's  checks  dated  variously  from  I  believe 
March  20  through  April  18.   I  have  only  made  two  copies  of 
these  volumes. 

[The  document  referred  to  was 
marked  for  identification  as 
Miller  Deposition  Exhibit  No. 
.22.] 
MR.  LEON:   Can  the  record  reflect  a  rough  estimate 
of  how  many  checks  there  are?  How  many  pages  would  you 
approximate? 

MR.  KAPLAN:   If  I'm  not  mistaken,  there  are 
approximately  $5,000  worth  of  traveller's  checks  that  are 
represented  by  this  exhibit. 

MR.  LEON:   Are  they  all  $100  checks? 
MR.  KAPLAN:   Yes,  I  believe  so. 

Mr.  Miller,  you've  seen  these  checks  once  before  and 
actually,  as  I  recall,  had  an  opportunity  to  lunch  with  them 
and  your  counsel.   I'm  going  to  ask  whether  any  of  these 

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checks  refresh  your  recollection  as  to  whether  or  not  you 
ever — as  to  whether  you  ever  received  any  traveller's  checks 
from  North  that  had  been  provided  to  him  by  Calero  or  anyone 
else. 

MR.  DUDLEY:   Well,  he's  testified  as  to  the 
incident  at  the  hotel . 

MR.  KAPLAN:   Right.   That's  correct.   Other  than 
that. 

MR.  MILLER:   It  doesn't  refresh  my  recollection. 
Other  than  that,  I  can't  remember  an  instance. 

MR.  KAPLAN:   To  the  best  of  your  recollection — and 
you've  been  through  these  checks  once  before — would  these 
checks  represent  other  than  possibly  the  hotel  incident, 
checks  that  were  given  to  you  directly  by  Calero  as  payment 
for  services  performed  on  behalf  of  the  Nicaraguan  Development 
Council? 

MR.  DUDLEY:   Before  he  answers  that  question,  I 
assume — but  I  would  like  your  representation — that  this  is 
the  same  bundle  of  checks  that  he  did  look  at. 

MR.  KAPLAN:   This  is  the  same  bundle  of  checks  that 
was  reviewed  by  Mr.  Miller  a  couple  of  months  ago. 

MR.  MILLER:   I  would  assume,  since  I  got  paid  in 
traveller's  checks  and  usually  from  a  Latin  American  bank, 
that  that's  true.   I  never  kept  track  of  the  traveller's 
checks  after  I  cashed  them 


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BY  MR.  KAPLAN: 
Q    Did  Colonel  North  ever  ask  you  to  cash  traveller's 
checks  for  him? 

A    I  don't  ever  recall  being  asked  to  cash  traveller's 
checks . 

Q    Did  Mr.  Calero  or  anyone  else  ever  ask  you  to  cash 
traveller's  checks  and  return  the  money  to  some  party  other 
than  yourself? 

A    I  don't  recall  doing  that. 

Q    So  it's  your  testimony  that  any  traveller's  checks 
here  or  that  you  received  from  Mr.  Calero  or  possibly  from 
North  during  that  hotel  incident  which  you  described  before — 
checks  that  would  have  been  in  payment  for  seirvices  performed 
by  IBC  on  behalf  of  the  Nicaraguan  Development  Council. 

A    That's  my  recollection. 

MR.  DUDLEY:   Or  reimbursement  of  hospital  expenses. 

MR.  KAPLAN:   Right.   Or  reimbursement  of  hospital 
expenses . 

BT  MR.  KAPLAN: 

Q    Do  you  ever — do  you  recall  having  given  Mr.  Robelo 
cash  in  front  of  a  hotel  in  Washington? 

A    Yes.   I  gave — I'm  not  sure  whether  it  was  cash  or 
traveller's  checks.  And  with  the  IRS  right  around  the 
corner,  I  wish  I  knew  the  answer  to  that  one  right  now.   We 
paid  his  hotel  bill  one  time,  and  I  gave  it  to  him  in  cash 

imfti  iHAifi-. 


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because  they  weren't  accepting  his  MasterCard,  as  I  recall. 
And  it  seems  to  me  it  was  somewhere  in  the  neighborhood  of 
about  $2,000  or  $2,500  or  something  like  that. 

Q    Do  you  recall  when  that  transaction  took  place? 

No. 

1985? 

I  really  don't  recall  when. 

Did  North  ask  you  to  give  Robelo  the  cash? 

Yes. 

What  was  the  source  of  the  funds  to  which  you  gave 


A 
Q 
A 
Q 
A 
Q 

Robelo? 
A 


Would  have  been  NEPL  funds  that  Colonel  North 
thought  he  had  access  to. 

Q    So  it  would  have  been  some  time  after  July  1985. 

A    Probably . 

Q    And  some  time  before  December  1986. 

A    Probably . 

MR.  KAPLAN:   Let's  knock  off  for  today. 

[Whereupon  at  5:34  p.m.,  the  deposition  was  concluded 


UNCUSSIFIED 


297 


U*l 


CERTIFICATE  OF  NOTARY  REPORTER 
I,  Terry  Barham,  the  officer  before  whom  the 
foregoing  deposition  was  taken,  do  hereby  certify  that  the 
witness  whose  testimony  appears  in  the  foregoing  transcript 
was  duly  sworn  by  me;  that  the  testimony  of  said  witness  was 
taken  by  me  and  thereaftrer  reduced  to  typewriting  by  me  or 
under  my  supervision;  that  said  deposition  transcript  is  a 
true  record  of  the  testimony  given  by  said  witness;  that  I  am 
neither  counsel  for,  related  to,  nor  employed  by  any  of  the 
parties  to  the  action  in  which  this  deposition  was  taken; 
and,  further,  that  I  am  not  a  relative  or  employee  of  any 
attorney  or  counsel  employed  by  the  parties  hereto,  nor 
financially  or  otherwise  interested  in  the  outcome  of  the 
action. 


Terry 
and 


y  Bbrhan^xfiota 
for' th/oistri 


(otary  Public  in 
District  of  Columbia 


)07  C        ...  N.I. 


My  connnission  expires   Hay   15,    1989. 


UNCUSSIFIED 


298 


i'artUIly  Dcd«MMi/R«feMed  on  -    i^    Ji]   ^r  ^  r 
mdm  provisions  :  i  £.0.  12356 
-*)r  O.  Mb,  Nalioncl  iecuHty  Coundl 


299 


DNCUlSSIfe 


294 


SELECT  COMMITTEE  TO  INVESTIGATE  COVERT 

ARMS  TRANSACTIONS  WITH  IRAN 

U.S.  HOUSE  OF  REPRESENTATIVES 

AND 

SELECT  COMMITTEE  ON  SECRET  MILITARY  ASSISTANCE 

TO  IRAN  AND  THE  NICARAGUAN  OPPOSITION 

UNITED  STATES  SENATE 

Friday,  August  21,  1987. 

Washington,  D.C. 

Deposition  of  RICHARD  RODERICK  MILLER  taken  on 

behalf  of  the  Select  Committees  above  cited,  pursuant  to 

notice,  commencing  at  8:40  a.m.  in  Room  901  of  the  Hart 

Senate  Office  Building,  before  Terry  Barham,  a  notary  public 

in  and  for  the  District  of  Columbia,  when  were  present: 

For  the  Senate  Select  Committee: 

JAMES  B.  KAPLAN,  Esq. 
Associate  Counsel 

For  the  House  Select  Committee: 

JOHN  FRYMAN,  Esq. 
SPENCER  OLIVER,  Esq. 
RICHARD  J.  LEON,  Esq. 


■MLUM  nromwta  co..  nc 

507  C  Sum.  N  E 
WuhmfToo.  0  C     2000] 
(20''1  146-MM 


UNCLASSIHED 


300 


295 


UNcussro 


For  the  deponent: 


EARL  C.  DUDLEY,  JR.,  Esq. 

" 

Nussbaum,  Owen  &  Webster 

One  Thomas  Circle 

Washington,  D.  C.  20005 

CONTENTS 

Examination  by  counsel  for 

Paqe 

Senate  Select  Committee 

296 

EXHIBITS 

Exhibits 

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miMK  mromwn  co^  mc 

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■UXR  MMKTWO  CO..  MG. 

yn  c  Smtt.  N  E  25 

Waihsi|ioa.  D  C     20002 
'»»  <«*•**" 


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•8* 


III 

jid 

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whereupon, 

RICHARD  RODERICK  MILLER 
the  witness  on  the  stand  at  time  of  adjournment,  resumed  the 
witness  stand  and,  having  previously  been  duly  sworn,  was 
further  examined  and  further  testified  as  follows: 
EXAMINATION  BY  COUNSEL  FOR 
THE  SENATE  SELECT  COMMITTEE  (Continued) 
BY  MR.  KAPLAN: 
Q    Mr.  Miller,  this  is  a  continuation  of  the  previous 
sessions  of  your  deposition  taken  pursuant  to  immunity  orders 
of  the  Senate  and  the  House,  which  are  Exhibits  1  and  4, 
respectively,  in  this  deposition.   I  would  simply  remind  you 
that  you  are  still  under  oath. 

I  just  want  to  refer  you  back,  for  a  moment,  to 
what  was  marked  late  yesterday  as  Miller  Deposition  Exhibit 
Number  22.   That  is  a  composite  exhibit  of  a  stack  of 
traveler's  checks  that  were  signed  and  cashed  by  you. 

I  asked  you  yesterday,  whether  or  not  you  were  ever 
asked  by  anyone,  or  whether  you  cashed  any  of  these  checks 
for  anyone  other  than  yourself,  and  I  believe  you  responded 
that  you  could  not  recall  ever  having  done  so. 

I  simply  want  to  ask  you  whether  it  refreshes  your 
recollection  on  that  response,  or  whether  it  changes  that 
response  at  all,  if  I  told  you  that  we've  determined  that  the 
checks  that  were  cashed  on  March  28th  are  consecutive  in 


302 


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Tuhiniroa.  0  C     20002 


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number  with  checks  that  were  cashed  by  Robert  Owen  and 
Jonathan  Miller  at  the  request  of  Colonel  North? 

A    No,  that  doesn't  change  my  statement. 

Q    So  I  take  it  that  your  testimony  is  that  to  the 
best  of  your  recollection,  all  the  checks  here  which  you  had 
an  opportunity  to  review  with  counsel,  back  in  June,  and  then 
again,  briefly,  yesterday,  are  checks  that  were  attributable 
either  to  compensation  paid  to  you  by  Mr.  Calero  on  behalf  of 
the  Nicaraguan  Development  Council,  or  as  part  of  a  hotel 
incident  to  which  you  testified  yesterday? 

A    Or  potentially,  the  reimbursement  of  the  expenses 
for  the  little  girl  that  I  put  in  the  hospital. 

Q    Okay.   Thank  you.   Staying  with  Mr.  Calero  for  a 
moment,  what  kind  of  knowledge  did  you  have  back  in  1985  and 
1986  of  bank  accounts  that  were  controlled  by  Mr.  Calero? 

A    Hell,  the ^^^^^^^^^^Haccounts  were  clearly  Mr. 
Calero 's  accounts,  and  I  think  I  knew  that  from  the  beginning 
of  my  transfers  to  those  accounts. 

.  Q    Who  would  have  told  you  that  thei 
accounts  were  Mr.  Calero's  controlled  accounts? 

A    Colonel  North. 

Q  Were  there  any  other  accounts  that  were  under  Mr. 
Calero's  control  about  which  you  had  some  knowledge  during 
1985  and  1986? 

A    Well,  checks  were  made  out  to  the  Nicaraguan 


t  which  you  had  some  knov 

ONOUSSIFiED 


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MTCSocn.  NE.  25 

Vidua|tga.  DC.    20001 
(»:)»«  tut 


ONCLASSinED 


298 


Development  Council  in  a  couple  of  fund-raising  situations. 
Where  they  were  deposited,  I'm  not  sure,  to  be  honest  with 
you.   Those  are  the  only  ones  I  can  remember. 
[Witness  and  attorney  consult.] 

THE  WITNESS:   The  Lake  Resources  account  was  to  our 
understanding  an  account  that  was  for  the  benefit  of  Mr. 
Calero.   It  was  never  clear,  initially,  who  it  was,  but  that 
was  our  understanding. 

BY  MR.  KAPLANt 
Q    When  you  say  it  was  for  the  benefit  of  Mr.  Calero, 
was  it  your  understanding  that  Mr.  Calero  controlled  that 
account? 

A    I  don't  think  I  was  ever  told  that  he  controlled 
it.   It  was  just  clear  that  that — whoever  that  Lake  Resources 
organization  was,  they  were  actively  involved  in  the  support. 
And  the  items  that  were  being  asked  that  we  fund-raise  for, 
and  those  vo   transferred  money  for,  were  for  things  that 
would  have  been  virtually  impossible  for  him  to  miss.   The 
heavy  lifting  system,  aircraft.  In  the  case  of  the  surface- 
to-air  missiles,  so — that  ultimately  became  radios,  but  they 
ended  up  on  the  ground,  so — 

Q    Now  over  time,  you  developed  a  fairly  close 
relationship  with  Mr.  Calero,  it's  fair  to  say,  is  that 
correct? 

A    Yes. 


im 


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_  *<? 

"^     22 

^*'  23 

24 

■UJll  NOOHTMa  CO..  HC 
mCima.Hl.  25 

••AMfna.  DC.    2000] 


^S} 


b 


LASSIFIED 


299 


Q    Did  you  ever  discuss  the  Lake  Resources  account 
with  Mr.  Calero? 

A    Yes,  in  December  of  1986. 

Q    Any  time  before  that,  do  you  recall  a  discussion 
with  Mr.  Calero  about  Lake  Resources? 

A    No. 

Q    None  at  all? 

A    No. 

Q    Did  you  ever  discuss  with  Mr.  Calero  disbursements 
from  the  IC,  Inc.  account  to  Lake  Resources,  that  were  made 
at  the  direction  of  Colonel  North? 

A    Only  once.   Colonel  North  told  me  that  Mr.  Calero 
was  in  desperate  need  of  money  for  a  food  bill,  and  asked  me 
to  go  to  his  hotel,  at  the  Connecticut  Club,  and  to  tell  him 
that  I  had  a  donor  from  outside  the  United  States,  and  that 
individual  wanted  to  give  him — I  believe  it  was  $150,000 — and 
that  I  should  ask  him  for  an  account. 

Of  course  the  account  would  be  exactly  the  same 
account  that  had  been  given  before,  but  apparently  Mr.  Calero 
was  unaware  that  I  was  the  individual  transferring  the  money 
into  his  account.   So  I  did.   I  went  to  the  hotel.   He 
immediately  asked  me  for  $250,000,  but  I  told  him  there  was 
150  available,  and  he  wrote  the  account  number  down  for  me, 
and  it  was  identical  to  what  I  had  used  for  previous  transac- 
tions.  And  I  transferred  money  into  that  account. 


305 


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VuhingTOA.  D  C      :0002 


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Mr.  LEON:   Let  me  just  ask  one  follow-up.   when  you 
say  Mr.  Miller,  that  the  Lake  Resources  account  to  your 
understanding  was  for  Mr.  Calero,  you  don't  mean  for  him 
personally,  but  rather,  for  the  contras? 

THE  WITNESS:   That's  correct,  because  it  was  used 
to  buy  things  like  heavy-lifting  and  Maule  aircraft,  and 
radios,  and  surface-to-air  missiles,  and  so  forth. 
BY  MR.  KAPLAN: 
Q    When  you  say  that  the  account  number  that  Calero 
wrote  down  for  you  was  identical  to  the  account  that  you  had 
previously  used,  could  you  just  clarify  for  the  record  which 
account  niomber  you're  talking  about. 

an  ^^^^^^^^^^^^^^Haccoun 
ii^^^^^^^^^^^^B 

Q    Do  you  recall  when  Colonel  North  first  told  you 
about  thisB^^^H^^^^Haccount,  and  that    was  under  Mr. 
Calero 's  control? 

A    Not  offhand,  but  he  would  have  done  so  immediately, 
prior  to  the  first  transaction  ^C'^^^^^^^^^H,  so  whatever 

Q    Do  you  recall  Having  instr-icted  Mr.  Channell  to 

check  to^^^^^^^^^^^^that  was  being  given  by 

Channell  to  Mr.  Calero,  for  his  behalf,  back  in  June  of  1985?  ' 

A    Yes.   At  one  fund-raiser  in  the  Hay-Adams,  Mr.      ! 
Channell  asked  who  the  check  should  be  made  out  to,  and  Mr.    j 


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M7  C  Sirni.  N  E.  25 

Wuhaiifna.  DC      20001 


SSIFIED 


301 


Calero  said — I  went  and  asked  Mr.  Calero  and  he  said^^^m 
And  then,  I  think  it  was  the  next  morning,  when  I 
told  Colonel  North  that  it  had  been  made  out  ^°^^^^^ 
^^^^^|.   He  said  that  that  was  wrong,  and  I  believe  it  was 
changed  to  the  Nicaraguan  Development  Council. 

Q    Okay.   I'm  going  to  march,  briefly,  with  the  State 
Department  contracts  that  were  held  by  IBC.   Hy  understanding 
is  that  Mr.  Fryman  is  going  to  cover  them  in  more  depth  at 
the  next  session. 

I  understand  that  IBC  had,  over  time,  from  1984 
until  September  of  1986,  I  believe  you  testified  yesterday  a 
number  of  consecutive  State  Department  contracts,  is  that 
correct? 

A    Correct.   Yes. 

Q    To  your  knowledge,  were  those  contracts  obtained 
from  the  State  Depeurtment? 

A    Well,  initially,  Mr.  Gomez's  expertise  was  sought 
out' by  the  office  that  had  newly  been  created  by  Ambassador 
Retch.   Frank  is  20  years  in  the  Foreign  Service.   Most  of 
it's  been  in  Central  and  South  America.   He's  fluent  in 
Spanish,  Portuguese  and  French.   Speaks  some  Italian.   And  is 
extremely  well  known  by  people  in  Central  America,  senior 


officials,  journalists.   In  fact  was  the  originator  of  one  of  ' 

'i*!iSS!FIEIl 

So,  that  was  exactly  the  type  of  individual  that    | 


the  journals  and  associations  down  there <  <i|'''>S 


307 


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mixii  KooirnNa  co..  mc. 

MTCSirm.  NE                25 

WMhiaftoa.  0  C. 

10002 

K^^^Ui 


i^nmwB 


302 


the  State  Department  Office  of  Public  Liaison  needed,  or, 
public  diplomacy  needed  to  begin  their  mission. 

Q    When  was  the  first  such  contract  let  to  Mr.  Gomez? 

A    I  think  it  was  signed  on  February  22nd,  1984. 

Q    So  that  was  shortly  after  he  retired  from  the  State 
Department? 

A    That's  correct. 

Q    Were  those  contracts,  or  was  that  contract,  that 
same  contract,  renewed  at  some  point  in  time? 

A    It  was.   It  was  actually  a  purchase  order  contract, 
and  it  was  reissued,  I  believe  two  more  times. 

Q    To  Mr.  Gomez? 

A    To  Mr.  Gomez.   That's  right. 

Q    Do  you  recall  what  the  average  length  of  these 
contracts  was? 

A    It  seems  to  me  they  were  about  3  months. 

Q    Was  there  a  time  when  the  contracts  were  let  to  IBC 
instead  of  to  Mr.  Gomez? 

-  A    Well,  when  Mr.  Gomez  and  I  began  to  form  a  partner- 
ship in  '85,  he  requested  that  the  contracts  be  made  to 
himself  at  International  Business  Communications,  and  as  we 
began  to  form  the  partnership  he  simply  brought  that  in  as 
part  of — it  was  already  a  consulting  contact  for  him  and  he 
brought  it  in  as  part  of  the  partnership  business. 

Q    Was  IBC  then  listed  as  the  contractor  on  the 


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303 


contract  itself? 

A    In  those  three  contracts,  no.   In  the  fourth 
contract  I  believe  yes,  but  again,  using  his  name  and 
International  Business  Communications. 

Q    How  many  contracts  were  there,  all-told? 

A    I  believe  total,  there  were  six.   Seven.   I'm 
sorry.   Seven,  including  the  INSI  contract. 

Q    How  many  of  these  contracts  were  identical  in  terms 
of  the  duties  performed  by  Mr.  Gomez  and  IBC? 

A    That's  not  the  right  question.   The  elements  that 
were  in  the  first  three  contracts  were  also  in  the  fourth 
contract  and  in  the  fifth  contract.   The  fifth  contract,  the 
larger  of  all  of  them,  a  200  and  some-thousand  dollar 
contract,  had  in  it  an  additional  section  for  a  distribution 
system. 

So  the  elements  did  not  change  significantly  from 
the  first  contract  to  the  last  contract,  except  for  the 
increase  to  incorporate  a  distribution  system. 

.  Q    Okay.  What  was  the  sum  total  of  these  seven 
contracts? 

A    About  440-some  thousand  dollars. 


Q    All  right.   You  mentioned  that  one  of  the  contracts 

ufr' 

was  over  $200,000?      IK 

A    Yeah.   We  bid  it  at  242 — or  342,  and  they  told  us 


mentioned  that  one  of 

NCLASSIRED 


it  was  going  to  cost — I'm  sorry.   We  bid  it  at  242.   They 


309 


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(202)  )4«-«4M 


omssifiEo 


304 


told  us  it  was  going  to  cost  282,  and  we  came  in  at  276,  I 
believe. 

Q    Were  the  other  contracts  reasonably  equal  in  amount? 
A    I  think  they  were  almost  exactly  equal.   The  fourth 
contract  was  nothing  other  than  a  longer  time  period.   The 
previous  three  contracts  had  all  been  purchase  orders,  so 
they  were  for  short  periods  of  time. 

Q    So  they  were  in  the  range  of  40  to  $50,000  each? 
A    I  think  the  first  three  contracts  were  slightly 
under  $10,000  each,  and  I  think  the  third  contract— the 
fourth  contract  was  about  $90,000. 

Q    what  duties  did  Mr.  Gomez,  and  others  at  IBC, 
including  ourself,  perform  under  these  contracts? 

A    Let  me  see  if  I  can  do  it  again,  off  the  top  of  my 
head.   We  provided  escort  services  for  exiles,  refugees, 
atrocity  victims.   We  provided  translation  services  for  the 
same  people.   In  some  cases  we  provided  security  for  them. 

We  provided  simultaneous  interpretation.   We 
provided  housing,  transportation.   We  provided  media  contact 
for  these  same  people.  We  provided  civic-leader  contact  for 
these  people.   We  sought  to  put  the 
organizations  in  the  United  States.] 

We  did  debrief ings  for  them.   We  set  up  interviews 
and  press  conferences.   We  arranged  television  appearances 
For  the  office  in  general  we  provided  text  for  op-eds , 


ims»o 


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WCiuKl.Nl  25 

Vutuiftaa.  DC.    2000] 


INCUSSIRED 


305 


editorials,  letters  to  the  editor,  articles,  translations  of 
publications  outside  the  United  States  that  were  then 
distributed  by  the  office. 

We  helped  arrange  media  schedules,  made  strategic 
planning  suggestions  for  development  of  public  expressions  of 
policy.   We  helped  draft  reports  on  public-affairs  strategies. 
We  helped  edit  texts  for  speeches.   In  the  distribution  area 
we  created  a  computerized  database  for  the  use  of  the  office 
in  the  distribution  of  its  publications. 

They  could  be  segmented  into  multiple  selection 
processes  so  that  they  could  be  distributed  by  subject,  by 
geographic  location,  by  a  whole  host  of  demographics.   We  set 
up  an  internal  control  system  to  improve  the  procedures 
associated  with  the  production  and  ultimate  distribution  of 
publications . 

We  provided  staff  on  site  at  State  Department  to 
handle  that  task.   We  did  the  actual  physical  distribution  of 
hundreds  of  thousands  of  pages  and  single  documents.   I 
remember  one  distribution  being  70,000  copies.   We  provided 
the  delivery  of  those  to  the  Federal  agencies  that  were 
involved  in  the  matter  here  in  Washington.   We  provided  the 
transportation  and  the  storage  for  those  documents.   And  we 
also  provided  a  training  course  for  the  information  office  of 
the  Salvadoran  government. 


iCUSSIHED 


And  we  provided  talking  points  for,  or  suggested 


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talking  points  for  senior  administration  officials.   That's 
all  I  can  remember,  off  the  top  of  my  head. 

Q    Is  it  fair  to  say  that  in  your  work  under  these 
contracts  you  were  brought  in  close  and  regular  contact  with 
Mr.  Calero,  Alfonso  Robelo  and  Arturo  Cruz? 
A    No. 

Q    Did  you  coordinate  any  of  their  travel  or  visits  to 
the  United  States? 
A    Yes. 

Q    Was  that  a  service  that  you  performed  under  these 
contracts?   Or  was  that  a  service  that  you  performed  in 
connection  with  your  duties  that  you  described  yesterday  on 
behalf  of  the  Nicaraguan  Development  Council? 

A  We  considered  it  duties  on  behalf  of  the  Nicaraguan 
Development  Council.  Initially,  also,  our  work  with  the  Gulf 
and  Caribbean  Foundation. 

Q    So  is  it  fair  to  say,  then,  that  at  least  your  work 
on  behalf  of  the  Nicaraguan  Development  Council  brought  you 
into  fairly  close  and  regular  contact  with  Mr.  Calero,  Mr. 
Robelo  and  Mr.  Cruz? 
A    Yes. 
Q    Did  North  ever  contact  the  State  Department  on 


I  EC's  behalf,  to  your  knowledge?  ;^  Sji 

ui 

cifj 


CLASSIFIED 


A    I  don't  recall  the  specific  instance  but  I've  read 
the  press  reports  on  it,  and  I  have  a  minor  memory  of  him 


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Of^CUSSinED 


307 


doing  so. 

Q    And  do  you  recall  when  he  made  that  contact? 

A    I  don't  recall  when  but  I  recall  why. 

Q    Could  you  tell  us  why. 

A    Yeah.   We  had  billed  the  State  Department  for  three 
months'  worth  of  work,  and  I  think  it  was  already  30  days 
past  the  time  that  that  should  have  been  paid  under  the  Prompt 
Payment  Act.   And  we  were  just  not  that  big  a  company,  it  was 
a  very  serious  time  for  us,  and  we  needed  the  money,  and  he 
made  an  appeal  to  somebody  at  the  State  Department.   I've 
forgotten  exactly  who  it  was. 

Q    Why  did  you  approach  North  to  make  the  appeal  on 
your  behalf? 

A    I'm  not  sure  I  approached  him  on  it.   I  think  I 
just  may  have  bellyached  in  his  presence  and  he  acted. 

Q    He  acted? 

A    Yes. 

Q    Did  he  tell  you  that  he  had  contacted  someone  at 
State  on  your  behalf? 

A    I  don't  remember  whether  , he  told  he  was  going  to, 
or  whether  he  told  me  he  did. 


But  one  of  t 


Yeah. 


ilASSIFIED 


Q    Did  his  contacts  result  in  prompt  payment? 

A    I  guess  the  Government  would  have  considered  it 


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Varfuaitoa.  DC.    20002 


Oi 


WSIFIED 


308 


prompt  payment.   I'm  not  sure  it  came   much  quicker  than  it 
would  have  been  otherwise. 

Q    Do  you  know  who  he  contacted  at  the  State  Depart- 
ment? 

A    I  want  to  say  Frank  Gardner,  but  I'm  not  sure.   It 
was  the  administrative — it  was  somebody  involved  in  the 
adminstration  of  the  Office  of  Public  Diplomacy. 

Q    Was  that  one  of  Mr.  Gardner's  duties? 

A    Yes. 

Q    Who  were  your  principal  contacts  at  the  State 
Department  under  these  contracts? 

A    Well,  it  changed  as  the  staff  changed.   Initially, 
it  was  Otto  Reich  and  Jonathan  Miller,  John  Blacken,  John 
Scafe.   Those  were  the  people  we  answered  to,  initially.   And 
also,  we  worked  with  Mary  Catherine  English,  Jake  Jacobowitz, 
Colonel  Larry  Tracy,  Colonel  Mark  Richards,  Dan  Fiske,  Bob 
Kegan.   Those  are  all  the  names  I  can  remember,  off  the  top 
of  my  head. 

-  Q    I'm  going  to  move  off  the  State  Department  con- 
tracts. As  I  said,  those  will  be  covered  in  more  depth,  I 
understand,  at  your  next  session. 

When  did  you  first  meet  Jonathan  Miller? 

A    I  met  Jonathan  in  the  campaign  in  1980. 

Q    What  kind  of  contact  did  you  have  with  him  after 
the  campaign? 


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HUIN  nvonniM  CO.,  mc. 
507  C  Sotti.  N  E.  25 

Wuhuipoa.  D  C    :ooai 

"""  'U.iUt 


wusjm 


309 


A  We  both  ended  up  at  AID,  myself  In  the  Public 
Affairs  Office,  and  Jonathan  in  the  Legislative  Affairs 
Office. 

Q    Did  you  and  he  develop  a  friendship? 

A    Yes. 

Q    Did  you  ever  discuss  with  him — and  I  think  I  asked 
you  this  yesterday,  but  if  I  did,  you  can  just  give  me  the 
same  answer.   Did  you  ever  discuss  with  him  your  contra- 
funding  efforts  with  NBPL  and  Colonel  North? 

A    I  don't  recall  ever  discussing  it. 

Q    All  right.   Do  you  recall  having  had  some  meetings 
with  Jonathan  Miller  and  Colonel  North? 

A    I'm  sure  I  have  but  I  don't — I  recall  one  meeting 
in  the  situation  room,  that  I  think  Jonathan  was  at. 

Q    What  types  of  substance — if  it  can  be  broken  down 
that  way — was  likely  discussed  in  meetings  that  you  would 
have  with  both  Mr.  Miller  and  Colonel  North? 

MR.  DUDLEY:   I  object  to  the  hypothetical  way  in 
which  that  question  was  framed.   Tou  know,  what  questions 
were  likely  discussed,  if  there  were  meetings. 

I  think  you  should  establish  whether  there  were 
meetings . 

MR.  KAPLAN:   I'm  sorry.   I_th2Waht  I  had  established 
that  before. 

THE  WITNESS:   Would  it  be  helpful  for  me  to 


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22 

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24 

muja>  ROODTMO  CO..  mc 
>07C  Siren.  NE  25 

Vuhinitoa.  D  C.    20001 


UNCUSSIFIED 


310 


remember  each  meeting?   i  would  go  as  far  as  my  memory  goes 
on  each  one  of  them. 

BY  MR.  KAPLAN: 
Q    Okay.   Why  don't  I  help  you  out  a  little.   Records 
that  the  Committees  have  obtained  in  the  course  of  their 
investigation  show  that  you  and  Colonel  North,  and  Mr.  Miller 
had  meetings  on  the  following  dates,  and  this  may  help  you 
place  yourself,  and  maybe  recall  some  of  the  substance  of 
those  meetings . 

September  10,  1984  with  Mr.  Gomez  also  in  atten- 
dance . 

January  16,  1985,  with  Mr.  Gomez  also  in  attendance. 

MR.  DUDLEY:   What  was  that  second  one?   I'm  sorry. 

MR.  KAPLAN:   January  16,  1985. 

It  is  unclear,  but  perhaps  meetings  with  a  group 
called  Citizens  for  America  on  January  25  and  January  28  of 
1985. 

February  27,  1985  with  Mr.  Gomez  and  Mr.  Owen  also 
in  attendance. 

June  5,  1985  with  Mr.  Gomez  and  a  person  named 
Otto,  who  I  presume  is  Otto  Reich. 

THE  WITNESS:   June  10? 

MR.  KAPLAN:   June  5,  1985.   I  believe  that's  the 
sum  total . 


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liu^H  wroirnNa  eo^  MC. 

WTCSum.  NE.  25 

Vuhmiraa.  D  C     20002 


OllASSinED 


311 


BY  MR.  KAPLAN! 

Q    So  all  those  meetings  vrould  have  taken  place  between 
September  of  1984  and  June  of  1984,  according  to  our  records, 
I  certainly  welcome  any  further  recollection  you  have  beyond 
what  we  have  on  paper.   I  also  will  note  for  the  record,  that 
the  September  '84  meeting  is  not  clustered  with  the  rest.   It 
seems  to  sort  of  hang  out  by  itself. 

Does  that  refresh  your  recollection  at  all  as  to 
the  substance  of  the  meetings  that  you  did  have  with  Colonel 
North,  Mr.  Miller,  and,  usually,  others? 

A    I  can  probably  identify  three  of  these,  and  I'll 
work  backwards,  chronologically.   The  June  5  meeting  with 
Otto  Reich,  I  believe  was  at  lunch.   The  third  meeting  I  can 
recall  is  a  Citizens  for  America  meeting,  which  I  believe  only 
took  place  on  one  of  those  dates.   I  think  you  probably  have 
a  vintage  North  calendar  entry  that  got  changed  several 
times,  and  that  in  reality  it  took  place  at  some,  one  of  those 
but  not  both  of  those. 

~  I  was  invited  to  a  meeting  in  the  situation  room 

that  was  attended  by — was  hosted  by  Colonel  North  and  was 
attended  by  Otto  Reich  and  Jonathan  Hiller,  Frank  Gomez  and 
myself.   Lew  Lehrman,  Jack  Abramoff,  and  two  other  officials 
of  the  Citizens  for  America  whose_neUiiea.  I  cannot  remember 
right  now.      ll 

Was  thaY  a  meeting  in  which  I  believe  that  your 


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HCLBI  l«>OIH»IU  CO..  HC 
M7  C  SiTKi.  N.E.  2  5 

Vuhuifioa.  DC.    20002 


UNCLASSIHED 


312 


counsel  have  produced  to  us  a  document  listing  the  attendees 
at  that  meeting  with  phone  numbers  on  the  righthand  column? 
A    Yea. 
Q    Okay. 

A    And  Lehrman  had  asked  for  the  meeting.   His 
intention  was  trying  to  create  political  support  for  the 
President's  policy.   Colonel  North  introduced  us  as  represen- 
tatives of  Mr.  Calero.   We  sat  through  a  presentation  by  Mr. 
Lehrman  of  a  fairly  weighty  and  seemed  to  be  a  well-thought- 
out  program  of  grassroots  education,  and  Colonel  North  asked 
what  the  Administration  could  do  to  help,  and  Mr.  Lehrman 
said  that  he  needed  to  have  $250,000. 

So  everybody's  immediate  reaction,  unspoken,  was 
the  same,  and  that  was  that  that  was  his  business  to  raise 
the  money  and  not  ours,  and  that  we  thought  we  were  being 
offered  help  and  not  asked  for  it,  in  terms  of  funding. 

So  I  think  the  idea  basically  exhausted  itself  and 
wenl  no  further. 
-  Q    Okay . 

A    I  remember — and  I  can't  tie  them  to  these  other  two 
dates,  January,  or  SeptembenlO  1984,  or  February  27th — but  I 
remember  being  called  over  to  North's  office — Frank  and  I 
both,  by  Jonathan  Miller,  and  that  Jonathan  was  housed  there 
at  the  time. 


And  the  UNO  leaders  ITaS^coflS^to  Washington,  and 


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McuN  Mvoimta  eo..  hc. 

M7  C  Sam.  N  E.  2  5 

Wahufiaa.  0  C.    20002 


ms\m 


313 


^ 
^ 

^ 

^ 


Colonel  North  asked  that  we  get  for  them  media,  and  we  used 
his  telephone,  and  then  ultimately,  went  back  to  the  office 
and  got  things  like  Good  Morning  America,  the  Today  show, 
Nightline,  and  Washington  Post. 

Q    Do  you  recall  when  this  incident  took  place? 

MR.  DUDLEY:   Will  you  excuse  me  just  a  minute. 
[Witness  and  attorney  consult.] 

MR.  DUDLEY:   I'm  sorry  to  interrupt  your  flow,  but 
I  wanted  to  get  something  before  it  got  too  far  past. 
MR.  KAPLAN:   It's  okay.   I  appreciate  that. 
BY  MR.  KAPLAN: 

Q    Do  you  recall  when  the  call  from  Jonathan  Miller 
came  and  this  incident  took  place? 

A    It  would  have  been — no,  I  don't  recall  the  exact 
date.   It  may  be  the  February  meeting — I'm  not  sure--but  it 
would  have  been  just  about  the  time  of  the  President's  first 
request  for  aid. 

Q    How  did  North,  to  your  knowledge,  first  become 
aware  of  your  association  with  Mr.  Calero? 

A    I  don't  know.   I've  never  remembered  our  first 
meeting,  so  I  can't  even  tell  you  why  we-- 

Q    Okay.   When  did  you  first  meet  Rob  Owen? 

A    Again,  I'm  not  sure  when  my  first  meeting  with  Rob 
was.   The  earliest  recollection  I  have  of  Rob  is  he  accom- 
panied a  group  of  three  refugees  to  our  offices,  along  with 


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SSIFIED 


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23 


24 

mxin  acMOTwa  co..  mc 
)0?  C  Such.  N  E  2  5 

Vuhin(t«i.  D  C      20002 


John  Hall,  and  we  were  in  our  offices  at  1607  fiew  Hampshire. 
So  it  would  have  had  to  have  been  some  time  between  February 
of  1984  and  January  of  1985. 

Q    Who  sent  Mr.  Owen  to  your  offices  with  the  refugees? 
A    I  don't  know.   We  didn't  know  he  was  coming  with  the 
refugees.   I  think  we  expected  the  refugees,  and  Mr.  Owen  and 
Mr.  Hall  showed  up  with  them,  along  with  two  other  in- 
dividuals . 

Q    Can  you  briefly  describe  the  substance  of  your 
relationship  with  Mr.  Owen  over  time,  starting  with  that 
first  meeting  with  the  refugees,  and  continuing  on  through  the 
end  of  this  year? 

A    Rob  was  a  personal  friend  of  mine.   We  have  had  a 
minimal  amount  of  professional  contact.   I  reviewed  a  public- 
affairs  strategy  he  produced  one  time.   He  has  provided  me 
with  background  information,  that  he  has  secured  a  lot  of 
this  down  in  Nicaragua  and^^^^^^^B  That's  about  the  extent 
of  Our  professional  relationship. 

-  Q    I  want  to  go  back  to  a  question  I  forgot  a  moment 
ago.   When  Mr.  Calero  told  you  in  December  1986  who  con- 
trolled Lake  Resources,  or  what  Lake  Resources  was — 
A    You  mean  Lake  Resources  or 
Q    Maybe  I  misunderstood,  then,  and  it's  worth 
clarifying  for  the  record.   I  thought  I  had  asked  you  when  did 
you  discover  that  what  the  Lake  Resources  account  was. 


320 


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aujn  mromnta  co..  mc. 

)07  C  ium.  N  E  2  5 

VutunfKM   O  C      iOOOl 


OSUSSIfl 


3X5 


A    No,  that  wasn't  your  previous  question,  but  I'd  be 
happy  to  answer  it. 

Q    Okay. 

A    When  Albert  Hakim  testified  before  the  Congress,  my 
first  inkling  that  it  was  more  than  Just  an  account  to  assist 
the  contras  came  when  I  read  the  front-page  article  that 
quoted  H.  Ross  Perot  as  having  been  asked  to  send  $2  million 
there. 

Q    That  would  have  been  in  December  of  1986? 

A    I  believe  it  was  December  6.   It  was  a  revelation. 

Q    Was  your  earlier  testimony  about  a  discussion  with 
Mr.  Calero  in  December  1986  relating  to  his  control  of^^^^ 


A    Correct. 

Q    But  I  take  it,  as  you  testified,  that  you  had  some 
inkling,  some  time  prior  to  December  1986,  that  Mr.  Calero 
knew  about  that  account,  if  not  controlled  it? 
A    No,  that's  not  what — 
-  Q    Is  that  not  correct? 

A    No,  that's  not  what  I  said. 

MR.  DUDLEY:   I  think  you'd  better  clarify  that. 

"  "IMSliHl""""  ■'" 

THE  WITNESS:   I  was  always  under  the  impression 
that  the  Lake  Resources  account  was  some  form  of  organization 


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■MLun  KtKMmira  co..  wc. 
507  C  Sum.  N  E  25 

WuhixifTon    D  C      20002 
IIOII  U6-66M 


m 


ILASSIFIEO 


316 


that  benefited  the  resistance,  because  we  raised  items  which 
then  appeared  in  newspaper  articles,  and  so  forth,  down 
there.   They  also  would  have  been  impossible  for  Mr.  Calero 
to  miss.   Big  airplanes,  heavy-lifting  systems,  Maule 
aircraft,  shoulder-launched  missiles. 

So  I  always  assximed  that  he  was  aware  of  the  Lake 
Resources  account.   It  wasn't  until  December  of  this  past 
year,  that  I  realized  that  he  knew  very  little  about  the  Lake 
Resources  account,  and  that  was  only  after  discussing  it  with 
him  directly. 

BY  MR.  KAPLAM: 

Q    Let's  go  back  to  Mr.  Owen.   Did  you  ever  discuss 
with  Mr.  Owen  your  role  in  contra-assistance  funding  NEPL? 

A    I  don't  recall  discussing  it  with  Rob,  no. 

Q    Did  Mr.  Owen  ever  discuss  with  you  his  role  in  a 
contra-resupply  network,  or  a  contra-resupply  operation? 

A    I  don't  believe  so. 

Q    Did  Colonel  North  ever  discuss  with  you  Mr.  Owen's 
rol«  in  the  contra-resupply  operation? 

A    Not  in  a  resupply  operation  per  se,  but  as  a 
courier  and  a  carrier  of  messages  from  him  to  political 
leaders. 

Q    What  did  you|  Iff^Sf'^^f^OMt^^Ij^  ^Qjj^ij^'^^relationship  with 
Colonel  North? 

A    I  thought  that  Mr.  Owen  was  employed  almost  solely 


m 


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X)7  C  SoKT    N  E 
WuhmfToo    D  C      20002 


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25 


ONCIASSIFIED 


317 


by  Colonel  North. 

Q    Were  you  aware  that  Owen  had  been  at  least  in  part 
placed  by  North  at  the  Nicaraguan  humanitarian  aid  office? 
A    Not  until  I  read  it  in  the  newspaper. 

MR.  KAPLAN:  I  am  going  to  ask  the  reporter  to  mark 
as  Deposition  Exhibit  Number  23  a  copy  of  a  document  provided 
by  your  counsel,  which  are  handwritten  notes. 

[The  document  referred  to  was  marked  for 
identification  as  Miller  Deposition 
Exhibit  No.  2  3. ] 
MR.  KAPLAN:   The  top  of  the  page  says  "IBC  expendi- 
tures for  Green. " 

BY  MR.  KAPLAN: 
Q    I  first  want  to  ask  you  if  you  recognize  those 
notes . 

A    Yes.   They're  mine. 

Q    Does  "expenditures  for  Green"  refer  to  expenditures 
by  IBC  for  Colonel  North,  or  at  his  request? 
"  A    At  his  request,  or  for  him,  right. 

Q    All  right.   The  date,  1985,  refers  to  the  year  in 
which  these  expenditures  _w^rjjn|d^? 
A    Correct. 

Q    The  very  first  entry  I  believe  says,  "S-lS-'that 
is,  June  19--and  it  says  "Owen  trip  expenses."   Then  the 
corresponding  number  is  $2200.   Were  you  aware  at  the  time 


USiriED 


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318 


that  Colonel  North  was  asking  you  to  make  certain  distrurse- 
ments,  that  some  of  these  disbursements  were  ta  pay  for  Mr. 
Owen's  travel? 

A    Yes.   In  fact  the  first  two  items  are  actually 
interconnected.   The  $2200  I  believe  was  cash,  and  the  3500  I 


6  l|  believe  was  traveler's  checks  for  him  to  take  with  him. 

i| 

7  I      Q    Who  provided  you  with  the  traveler's  checks  for  Mr. 

i! 

8  1  Owen  to  take  with  him? 


mjLMK  iwnjomo  cs..  mc 
vn  C  Sam.  NE  25 

Viduofmc.  D  c    :ooa2 


A    This  came  out  of  our  bank  account.   In  other  words, 
we  wrote  a  check  to  our  bank  and  got  traveler  checks,  and 
gave  them  to  .Mr.  Owen. 

Q    I  see.   Does  "NDC"  stand  for  Nicaraguan  Development 
Council? 

A    Yes. 

Q    If  they  were  traveler's  checks  taken  out  of  your 
bank  account,  why  would  the  notation  says  "NDC  traveler's 
checks?" 

A    At  that  point  I  can  only  assume  that  it  was  because 
I  thought  Rob  was  working  primarily  with  Calero's  orga.-.iza- 
tion,  and  I  would  have  put  NDC  down. 

Q    Is  it  possible  that  at  that  time  you  gave  to  Mr. 
Owen  the  blank  traveler's  checks'  that  had  been  given  to  you 
by  Mr.  Calero  irt^iDfW^  i^A  P^^t  iMViF^^  that  you  had 
24   performed? 

A    I  don't  think  so  because  I  think  there's  a  check 


IftiSSlREr 


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iMiJii  mromma  CO..  mc. 

M7  C  Sirett.  N  E  25 

Vuhmilca.  O  C     20002 


yUGUSSIFIED 


319 


that  corresponds  to  this  in  our  check  register,  and  I  believe 
that  was--I  mean,  I  think  "NDC  traveler's  checks"  is  just  a 
mental  note  to  myself  as  is  "Wire  to  Lake"  or  one  of  the 
others . 

Q    Move  down  two  entries  from  there  to  a  September  12th 
entry  which  I  believe  says  "Beacon  Creative  Writing,  $10,000." 
Can  you  explain  to  us,  briefly,  what  that  disbursement 
represented. 

A    Beacon  was  the  name  that  I  chose  for  Arturo  Cruz, 
Sr.  and — 

Q    He  wasn't  a  "car  part?" 

A    No.   He  was  a  great  deal  of  light.   He  was  an 
"illuminating  force"  so  we  called  him  Beacon. 

Q    But  you  could  have  called  him  Headlight. 

A    That's  true.   He  was  to  write  an  article  and  that 
$10,000  was  payment  for  the  writing  of  the  article. 

Q    I  take  it  that  the  other  entries  that  are  shown, 
which  I  believe  we  covered  yesterday — an  entry  for  Commercial 
Tulin,  anjthen  several  wires  to  Lake,  are  simply  disbursements 
from  IBC  that  were  made  at  Colonel  North's  direction? 

A    Correct. 

Q  Did  all  of   these  disbursements  come   from  money  that 

had  been   passed   to    IBCaicsri WffL A  M4%l>n^Pntended    for 
contra   assistance? 

A  Either  passed  to  us,    or — yes,    it   all   came   from  NEPL 


wm,m 


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24 
mxni  mronma  co .  mc. 

>07  C  imct.  N  E  25 

Vuhiniion.  0  C.     20OO2 


USSIFIED 


320 


money. 


Q    When  did  you  first  meet  Father  Tom  Dowling? 

A    I  think  it  was  fairly  late.   I  think  it  was  like 
1986. 

Q    When,  in  19867   Do  you  recall? 

A    I  don't.   I  recall,  I  think  he  was  in  Adolf o 
Calero's  presence  when  I  met  him. 

Q    Were  you  aware  that  Father  Dowling  was  a  principal 
of  the  Latin  American  Strategic  Studies  Institute? 

A    Yes. 

Q    Were  you  aware  of  that  fact  at  the  time  that 
Colonel  North  directed  disbursements,  and  of  IC,  Inc.,  to  the 
Latin  American  Strateg^ic.  Studies^  Institute? 

A    Yes. 

Q    Now  we  covered  it  yesterday.   One  of  the  disburse- 
ments of  $25,000,  I  believe,  that  went  to  Latin  American 
Strategic  Studies  Institute,  came  directly  from  IBC,  Inc.? 

A    Right. 
-  Q    I  believe  you  testified  that  that  $25,000  was 
directed  by  Colonel  North  also? 

A    It  was  requested  by  Tom  Dowling,  and  by  Adolf o 
Calero,  and  approved  by  Colonel  North. 

Q    Did  you  ever  discuss  with  Father  Dowling  your 
involvement  or  participation  in  what  I've  been  referring  to 
as  a  shorthand  or  a  contra-funding  network? 


ling,  ana  oy  Adoiro 

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A    Not  until  very  recently. 

Q    When  did  that  discussion  take  place? 

A    The  last  time  I  saw  him  was  about  three  or  four 
weeks  ago,  I  think. 

Q    Was  that  discussion  in  the  presence  of  counsel? 

A    No. 

Q    Can  you  tell  us  what  the  substance  of  that  discus- 
sion was . 

A    It  was  a  friendly  conversation  over  lunch.   I  don't 
recall  us  comparing  notes  about  much  in  the  way  of  transac- 
tions.  We  were  discussing  mostly  the  financial  difficulty  of 
his  organization  at  present. 

Q    What  was  the  piece  of  conversation  that  you  had  in 
which  you  told  him  about  your  involvement  in  the  contra- 
funding  network? 

A    Well,  I've  told  everybody  that  will  listen,  that 
this  allegation  by  Jane  McLaughlin,  that  Spitz  Channell  gave 
IBC  $5  million  to  go  to  the  freedom  fighters,  and  that  we 
kept  2  million  of  it  was  erroneous,  and  it  only  takes  then  a 
description  of  Spitz's  Central  American  Freedom  Program  to 
prove  my  point,  and  that's  what  I  di'J.   I  described  the 
Central  American  Freedom  Program. 

Q    Was  there  any  other  d^^usf ion  ai>out  your  involve- 
ment in  the  funding  network? 

A  No. 


it  diWS^ion  about  your    involv 

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Q    Do  you  recall  a  meeting  with  Father  Dowling  and 
Colonel  North,  and  yourself,  on  November  17,  1986? 

A     November  17,  1986?   Not  specifically. 

Q    Do  you  recall  such  a  meeting  generally? 

A    Not  really.   If  you  can  give  me  other  details, 
maybe  I  can  refresh  my  recollection. 

Q    Does  it  refresh  your  recollection  at  all,  if  i 
remind  you  that  November  17  was  a  Monday,  and  it  was  just  a 
few  days  prior  to  the  meetings  on  November  20  and  21  about 
which  you've  testified  before  here,  previously,  on  June  23rd? 

A    No. 

Q    Does  it  refresh  your  recollection  if  I  tell  you 
that  the  meeting  took  place  at  Colonel  North's  office? 

A    That's  where  I  was  trying  to  envision  it.   That 
still  doesn't  click. 

Q    Did  you  travel  to  Panama  in  November  1986? 

A    Yes. 

Q    What  was  the  purpose  of  that  travel? 

A    It  had  to  do  with  a  client  we  have  in  Panama.   It's 
unrelated  to  this  matter. 

Q    Did  you  return  from  Panama  with  some  cash? 

A    I  did. 

Q    Do  you  recall  how  much? 


)m  Panama  witn  some  cash? 

UNCLASSIFIED 


A    I  believe  it  was  slightly  over  $35,000. 
Q    what  was  the  source  of  that  cash? 


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A    It  was  $35,000  in  retainer  and  associated  expenses. 
Q    When  you  say  "retainer  and  associated  expenses," 
that's  payment  from  a  client  that  you  had  in  Paneuna? 

A    That's  correct.   We  reported  it  on  the  Treasury 
form  and  our  foreign-agent  registration  is  on  file  with  the 
Justice  Department. 

Q    Would  you  tell  us  the  name  of  the  client. 
MR.  DUDLEY:   May  we  go  off  the  record. 
MR.  KAPLAN:   Sure. 
[Brief  discussion  off  the  record.] 
MR.  KAPLAN:   On  the  record. 

In  an  of f-the-record  conversation  that  ensued,  I 
was  informed  by  counsel  for  the  witness,  Mr.  Miller,  that  the 
response  to  my  question  would  divulge,  on  a  record  which 
might  at  some  point  be  made  public,  the  identity  of  a  client, 
that  for  business  purposes,  and  for  no  purpose  related  to 
these  Committee  investigations,  Mr.  Miller  would  like  to  keep 
from  the  public,  as  a  matter  CLf  busJ.aes&-aU(ii^rofessional 
propriety . 

I  will  not  pursue  the  question  or  press  the 
question,  and  I  withdraw  it  from  the  record.   I  will  state, 
for  the  record,  that  counsel  for  the  Committees  have  been 
informed  previously  of  the  identity  of  that  client,  and  that 
identity  is  one  which  we  intend  to  guard  confidentially. 
THE  WITNESS:   Thank  you. 


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MR.  DUDLEY:   I  appreciate  that. 

BY  MR.  KAPLAN: 

Q    Why  were  you  paid  in  cash? 

A    I  don't  know. 

Q    Did  you  ask  for  a  cash  payment? 

A    No.   We  actually  asked  for  a  wire  transfer  which  is 
preferable,  but  we  received  cash. 

Q    Had  you  received  any  prior  payments  from  that 
client,  or  was  this  the  first  payment  that  you  received? 

A    No,  we  had  received  prior  payments. 

Q    You  had.   Were  those  payments  in  about  the  same 
amount? 

A    Yes. 

Q    What  was  the  billing  basis  that  you  had  with  that 
client? 

A    It's  a  retainer  relationship.   Monthly  retainer 
plus  expenses. 

-  Q    Did  you  receive  subsequent  payments  from  that 
client? 

A    Yes. 

Q    You  have.   Are  those  subsequent  payments  in 
approximately  the  same  ait^pyjjt^  ^f_  currency  _that_  ^ou  brought 
back  from  Panama? 

A    At  least  one  of  them,  and  then  our  amount  of 


amDUDt.  Sf  currency  that  yo 

liLSSSiflED 


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HLLW  mPOWTDM  CO..  INC. 
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retainer  was  reduced. 

Q  .   When  did  you  first  meet  Richard  Pena? 

A    I  met  Richard  when  I  was  at  the--well,  I'm  not 
sure,  but  some  time  before  1985. 

MR.  KAPLAN:   I'm  going  to  ask  the  reporter  to  mark 
as  Deposition  Exhibit  Number  24  a  copy  of  what  purports  to  be 
a  letter  from  Mr.  Pena  to  World  Affairs  Counselors,  Inc., 
dated  August  15,  1985. 

[The  document  referred  to  was  marked  for 
identification  as  Miller  Deposition 
Exhibit  No.  24. ] 
BY  MR.  KAPLAN: 

Q    I  ask  you  if  you  recognize  that  letter? 

A    Yes. 

Q    Is  that  a  letter  that  you  received  as  a  principal 
in  World  Affairs  Counselors,  Inc.? 

A    It  is  a  letter  I  received  addressed  to  World 
Affairs  Counselors,  Inc.,  but  it  was  delivered  to  me, 
personally. 

Q    Why  was  the  letter,  to  your  knowledge,  addressed  to 
World  Affairs  Counselors,  Inc.? 

A    Because  I  didn't  want  _it_  addie5sed_to_ljiternational 
Business  Communications. 

Q    Can  you  tell  us  why  you  didn't  want  it  addressed  to 
International  Business  Communications? 


u 


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A    Well,  it  really  is  an  offer  of  assistance  from  Mr. 
Pena  in  securing  a  favorable  price  tag  on  military  equipment 
after  the  Congressional  vote  approving  the  sale  of  military 
equipment,  or  the  purchase  of  military  equipment  for  the 
benefit  of  the  Nicaraguan  resistance.   And  there  was  no 
reason  why  that  type  of  business  should/ be  handled  in  any  way 
through  IBC.   That's  not  IBC's  business,  and  I  was  passing  it 
along  as  a  courtesy,  and  I  chose  World  Affairs  Counselors 
because  it  would  have  been  anonymous  to  anybody  here  in 
Washington,  and  it  had  to  be  addressed  to  somebody. 

Q    Is  it  fair  to  say  that  the  purchase  of  arms  is  also 
not  World  Affairs  Counselors'  business  as  well? 

A    That's  correct. 

Q    Who  was  this  letter  being  passed  on  to? 

A    I  passed  it  on  to  Colonel  North.   Mr.  Pena  asked  me 
to  pass  it  on  to  whoever  the  appropriate  person  was,  and  I 
think  he  assumed  I  knew  whoever  the  person  was  in  the  Central 
Intelligence  Agency  that  would  be  responsible  for  these  types 
of  things,  but  I  didn't,  so  I  just  asked  Colonel  North  to  pass 
it  on. 

Q    Do  you  know  why  Mr.  Pena  assumed  that  you  would  be 
someone  who  would  know  the  appropriate  j)erspn^ at  t^  C_IA  to 
pass  along  a  letter  of  this  sort? 

A    I  just  think  he  had  watched  us  operate  in  the  area 
of  Central  American  policy  and  had  a  good  understanding  of 


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Wuhintiixi.  O  C      20002 


UNCLASSIHED 


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how  close  we  were  to  Mr.  Calero,  and  just  assumed  that  we 
were  closely  associated  with  the  effort. 

MR.  DUDLEY:   So  the  record  is  clear,  those  are  your 
assumptions.   Are  they  based  on  any  conversations  you  had 
with  Pena? 

THE  WITNESS:   In  very  rough  terms.   I  mean,  not  any 
that  I  recall,  specifically. 
BY  MR.  KAPLAN: 

Q    The  letter  states  that  it  encloses  a  list  of 
products  available  from  a  number  of  entities  li-sted,  and  then 
it  has  an  attachment  which  is  called  "Price  List  of  Items 
Available.  "   I'll  just  state  for  the  record,  that  the  items 
listed  are  grenades,  anti-personnel  mines,  anti-tank  mine, 
NATO  standards,  bombs,  and  boots. 

Is  that  an  accurate  reading? 

A    Yes. 

Q    Did  you  understand  that  Mr.  Pena  was  going  to  send 
youa  letter  that  had-^ljpjg^tyQp^qf^  jyjoduct^  availability 
listed? 

A    I  understood  that  it  was  going  to  be  military 
equipment.   I  think  we  discussed  rifles  and  boots,  are  the 
only  thing  I  remember  specifically  discussing  before  this 
letter  arrived,  and  it  was  a  very  short  discussion.   I  told 
him  I  had  no  idea  how  to — what  a  price  tag  was  on  something 
like  that,  and  that  his  suppliers  would  have  to — 


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328 


Q    Did  you  assure  Mr.  Pena  that  you  would  pass  this 
letter  along  to  the  appropriate  people? 

A    Yes . 

Q    The  last  paragraph  of  the  letter  itself  makes 
reference  to  previous  discussions  that  Mr.  Pena  alleges  that 
he  had  with  you  and  states  that  —  and  I  will  just  quote  it  - 
-  "We  envision  that  commissions  payable  on  the  sale  of  any 
particular  product  will  be  divided  equally  among  the  corpora- 
tions involved  and  the  placement  of  that  product",  close 
quote.   Do  you  recall  the  previous  discussions  that  gave  rise 
to  that  last  paragraph? 

A    I  can  recall  Mr.  Pena  telling  me  that  his  company 
had  an  offshore  corporation.   I  can't  recall  specifically 
where  it  was,  and  that  he  felt  there  would  be  some  commission 
associated  with  this  sale.   I  think  one  or  both  of  these 
people  are  actually  clients  or  personal  friends  of  his,  and 
he  had  made  an  offer  for  splitting  whatever  commission  had 
cone  to  him.   I  didn't  take  it  particularly  seriously.   I 
didn't  anticipate  it.   In  fact,  in  all  honesty  I  treated  this 
whole  thing  fairly  casually. 

Q    Was  it  your  understanding  though  that  if  commissions 
were  received  from  the  purchase  by  the  CIA  of  any  of  these 
items  from  the  companies  listed  by  Jfc,  .^aa  ^hat  you  indeed 
would  share  in  those  commissions? 

A    It  was  clear  to  me  that  he  had  made  that  offer. 


'-Mil, -Pena  that  you  indeec 

iciASifinED 


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UNCLASSIFIED 


329 


I'm  not  sure  I  would  have  taken  him  up  on  it.   I  don't  even 
know  what  size  the  commissions  would  be  on  it. 

Q    Why  would  you  not  have  taken  him  up  on  that  offer? 

A     I'm  not  an  arms'  merchant.   I  don't  care  to  be  in 
the  arms'  merchant  business. 

Q    Okay . 

Is  it  your  testimony,  however,  that  you  did  give 
Mr.  Pena  the  name  World  Affairs  Counselors,  Inc.  because  that 
would  not  be  recognizable  — 

A    That's  correct. 

Q    —  in  the  domestic  United  States? 

A    Overseas.   Since  it  is  a  Cayman  corporation,  it 
would  have  been  impossible  for  somebody  to  find  out  who  the 
principal  beneficiaries  were.   So  anybody  trying  to  find  out 
who  this  letter  was  written  to  would  not  be  able  to  do  so, 
and  yet  still  the  letter  was  written  to  a  corporation  so  that 
it  was  a  legitimate  offer.   That  way  it  could  be  passed  on  to 
somebody  and  taken  seriously. 

"  Q     Is  it  also  fair  to  say  that  you  didn't  want  any 
national  business  communications'  name  on  a  letter  of  this 


sort? 


Absolutely. 

And  why  is  that? 


UNCIASSIRED 


A    Because  it  is  not  the  business  of  International 
Business  Communications. 


335 


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Q    Do  you  recall  Colonel  North's  reaction  when  you 
gave  him  this  letter? 

A    I  don't  even  think  he  took  it  out  of  the  envelope. 
He  just  said  that  he  would  pass  it  along,  but  I  believe  he 
said  that  he  thought  that  it  had  all  been  taken  care  of. 

Q    Did  you  have  any  subsequent  discussions  with 
Colonel  North  about  this  letter  or  Mr.  Pena's  offer? 

A    I  asked  him  one  time  whether  it  had  been  passed  on 
and  that  was  after  Mr.  Pena  had  asked  me  if  I  had  passed  it 
on  to  the  appropriate  person. 

Q    Okay. 

What  did  Colonel  North  tell  you? 

A    He  told  me  he  passed  it  on  to  the  appropriate 
person. 

Q    You  testified  on  June  23rd  about  meetings  that  you 
had  with  Colonel  North  on  November  20th  and  21st.   Have  you 
had  any  contacts  or  did  you  have  any  contacts  with  Colonel 
North  after  your  meeting  with  him  on  November  21st? 

-  A    Yes.   I  saw  him  probably  within  five  or  six  days  of 
leaving  the  National  Security  Council. 

Q    Were  you  repre^^ted^by  coMn^el_at_the  time? 

A    No. 

Q    Was  that  meeting  in  the  presence  of  his  counsel? 

A    No. 

Q    Can  you  tell  us  what  the  purpose  of  that  meeting 


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was? 

A    I  don't  know  what  defines  presence  of  counsel.   It 
was  at  his  attorney's  office. 

Q    Was  his  counsel  in  the  room? 

A     No. 

Q    Who  initiated  that  meeting? 

A    I  did. 

Q    You  did.   What  was  the  purpose? 

A    There  had  been  newspaper  articles  quoting  Oscar 
Matsunoros  and  unnamed  officials  of  the  Nlcaraguan  resistance, 
saying  that  they  had  only  gotten  a  few  hundred  thousand 
dollars  from  the  money  Mr.  Channell  raised,  and  that  he  had 
kept  it  all  or  IBC  had  kept  it  all.   And  knowing  that  we  had 
sent  $1.7  million  to  Lake  Resources  and  we  had  sent  over  $1 
million  directly  to  Calero's  accounts  and  then  the  balance  to 
other  organizations,  such  as  Mr.  Robelo's  and  so  forth,  that 
didn't  Jibe  with  reality. 

And  I  had  also  read  the  revelation  from  H.  Ross 
P9fot   that  he  had  been  asked  to  deposit  $2  million  into  Lake 
Resources.   And  it  was  suddenly  clear  to  me  that  that  account 
was  used  for  many  other  things  ^ther  than  Just  assistance  for 
the  Nicaraguan  resistance. 

So  I  went  to  him,  and  the  first  thing  I  said  to  him 
was  "I  hope  to  hell  that  that  account  was  used  for  humanita- 
rian assistance",  and  he  said,  "Oh  hell,  yes."   And  I  told 


IS  other  than  Just  assista 

UNCLASSIFIED 


337 


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COD  »«-«<«« 


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332 


him  of  my  concern  about  Mr.  Calero's  statements  and  that  it 
was  clear  to  me  and  that  it  was  not  clear  to  Mr.  Calero  that 
the  money  that  had  gone  to  Lake  Resources  and  to  his  accounts 
had  come  from  us.   And  he  listened  quietly  to  that.   I  asked 
him  whether  he  thought  it  would  be  a  good  idea  for  me  to  go 
see  Mr.  Ca_ero  and  explain  it  to  him.   And  his  sole  response 
was ,  " I  think  that  would  be  a  good  idea . " 

And  we  then  talked  a  bit  about  our  wives  and  what 
they  were  going  through,  and  he  showed  me  the  stack  of 
letters  behind  him,  and  told  me  that  he  was  working  on  his 
statement  to  be  read  to  the  Committees  on  a  computer.   And  I 
left,  and  that  is  the  sum  of  the  meeting. 

Q    Where  did  the  meeting  take  place? 

In  an  office  at  Williams  and  Connolly. 
Was  anyone  else  present  at  that  meeting? 
No. 

We  also  had  a  subsequent  meeting,  at  which  time  we 
were  both  represented  by  counsel  in  February. 

-  Q    Did  the  meeting  take  Piace  in  the  presence  of 
counsel? 

A    Yes,  my  counsel  and  his  co'jnsel. 

MR.  KAPLAN:   Mr.  Dudley,  would  you  assert  privilege 
as  to  the  communications  that  took  place  between  Mr.  Miller 
and  Mr.  North  during  that  meeting? 

MR.  DUDLEY:   I  am  prepared  to  let  Mr.  Miller 


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testify  with  respect  to  that  meeting,  provided  that  it  will 
not  be  claimed  by  the  Committee  or  anyone  connected  with  the 
Committees,  either  Committee,  that  doing  so  constitutes  a 
waiver  of  the  attorney/client  privilege.   I  am  not  prepared 
to  take  a  position  as  to  whether  that  meeting  actually  is 
privileged,  but  I  am  prepared  to  let  him  testify  so  long  as 
it  is  not  considered  a  general  waiver. 

MR.  KAPLAN:   On  that  understanding  which  we  can 
represent  will  be  the  understanding  of  both  Committees. 
BY  MR.  KAPLAN: 

Q    I  would  like  to  then  proceed  and  ask  Mr.  Miller 
what  was  the  substance  of  the  discussion  that  took  place  at 
that  meeting? 

A    I  had  been  since  November  putting  together  pretty 
much  by  myself  a  report  to  Mr.  Channell  of  how  his  money  had 
been  expended,  and  had  gotten  to  the  point  where  being  a 
metier  person,  I  recognized  that  it  was  days  before  it  would 
hit  the  front  page  of  the  Washington  Post  after  its  issuance, 
that  I  thought  Colonel  North ^houlc^ be  _at_J.ea£t  apprised  of 
what  was  in  it. 

And  I  asked  my  attorney  to  discuss  it  with  his 
attorney  and  a  subsequent  meeting  was  set  up.   And  he 
reviewed  the  report  briefly,  and  his  sole  concern  was  for  the 
personal  safety  of  two  individuals  mentioned  in  the  report, 
and  that  there  was  only  one  line  amended,  and  that  single 


North  should  be  at  least 

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a- 


line  simply  eliminated  references 

And  we  then  talked  about  his  dog,  and  we  talked 
about  our  wives  again  and  our  families  and  then  we  left  each 
other. 

Q    Who  else  was  present  at  that  meeting,  for  the 
record? 

A    Earl  Dudley,  Ronald  Precup,  Barry  Simon  and  Brenc^n 
Sullivan. 

MR.  DUDLEY:   I  should  state  that  I  don't  think 
everyone  was  always  present  for  all  parts  of  that  meeting. 
MR.  KAPLAN:   Okay. 
BY  MR.  KAPLAN: 
Q    Had  you  had  any  other  contacts  or  conversations 
with  Colonel  North  since  February,  since  that  meeting  that 
you  just  described? 

A    I  spoke  to  hin  briefly  by  telephone  before  Christmas 
to  wish  he  auid  his  family  a  merry  Christmas,  and  again  we 
talked  about  our  families  and  Max,  the  dog. 

We  may  have  had  one  other  coiiysnaiipn^  but  again  I 
think  it  was  just  of  a  personal  nature  J  |!^  a- 

Q    When  you  testified  a  momep":  ago  that  you  asked 
Colonel  North  whether  the  funds  that  had  been  raised  and 
disbursed  through  IBC  and  IC,  Inc.  had  been  used  for  humanita 
rian  purposes,  you  said  that  his  response  was,  "Hell,  yes.' 
Has  time  refreshed  your  recollection  to  amend  the  expletive 


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that  he  used  in  response  to  the  question? 

A    I  would  say  it's  ambiguous  enough  that  it  could 
have  been  either  my  previous  recollection  or  the  present 
recollection. 

MR.  KAPLAN:   I'm  sorry.   I  couldn't  avoid  it. 

MR.  DUDLEY:   Only  the  expletives  have  been  deleted. 

THE  WITNESS:   He  is  a  marine  officer,  you  know. 

BY  MR.  KAPLAN: 
Q    To  your knowledge,  were  there  any  gifts  or  other 
items  of  value  that  were  given  to  North  or  his  family  by 
anyone  during  the  time  that  you  have  known  Colonel  North? 

MR.  DUDLEY:   Did  you  say  other? 

MR.  KAPLAN:   No.   I  said  by  anyone. 

MR.  DUDLEY:   I  want  to  know  whether  the  word 
"other"  was  in  there  before  the  word  "gifts". 

MR.  KAPLAN:   I  said  gifts  or  other  items  of  value. 

MR.  DUDLEY:   I  thought  I  heard  you  say  were  there 
any'  other  gifts  or  items  of  value  given. 

MR.  KAPLAN:   No.   I  will  withdraw  the  previous 
question  and  ask  this  one  again. 

BY  MR.  KAPLAN: 
Q    To  your  knowledge,  was  Colonel  Noftfi 'givSi^any 
gifts  or  other  items  of  value  during  your  relationship  with 
him  by  anyone? 

A    Well,  I  gave  him  a  gift  but  I  think  it  was  of  more 


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value  to  me  than  it  was  to  him. 

Q    And  what  was  the  gift  you  gave  him? 

A     It  was  a  Labrador  pup,  and  it  was  after  the  stories 
had  come  out  about  his  dog  being  poisoned.   And  I  am  a  dog 
lover  and  raise  Labradors,  and  I  couldn't  stand  the  thought 
of  his  children  being  without  their  dog.   So  I  promptly  went 
over  with  my  pregnant  wife  and  delivered  a  beautiful  little 
yellow  Lab  pup,  only  to  fihd  out  later  that  the  dog  that  was 
killed  was  about  six  inches  tall.   So  I  am  not  sure  he  has 
ever  been  as  grateful  as  I  thought  he  would  be  for  introducing 
this  monstrous  97  pound  beast  into  his  household. 

Q  You  may  have  taken  a  liking  to  me  over  the  course 
of  our  relationship,  and  I  know  my  wife  would  appreciate  it 
if  you  didn't  deliver  a  Labrador  pup. 

A    I  always  remember  things.   So  I  never  do  the  wrong 
thing  twice. 

Q    Are  there  any  other  gifts  or  items  of  value  that 
you  or  any  of  your  associates  gave  to  North  during  the  time 
of  'your  professional  relatJLosahla  wj.tii  iLijn? 

A    None  other. 

Q    Are  you  aware  of  gifts  or  items  of  value  given  to 
North  by  Mr.  Channell,  and  I  will  say  other  than  the  implica 
tion  of  your  testimony  that  North  flew  on  a  Channell  chartered 
plane  or  a  Newington  chartered  plane  to  Mrs.  Newington's  that 
weekend? 


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A    I  think  when  Mrs.  Newington  —  when  we  were  at  Mrs. 
Newington's,  she  gave  each  of  us  a  tie.   I  got  one.   I'm 
pretty  sure  Colonel  North  got  one. 

Q    Do  you  recall  a  briefcase  that  Mr.  Channell  or 
yourself  might  have  given  to  Colonel  North  at  some  time 
during  1985  or  19867 

A    I  remember  Mr.  Channell  giving  me  a  briefcase,  but 
I  don't  remember  him  giving  Mr.  North  one. 

Q    Okay. 

Have  you  had  any  contacts  with  Mr.  Channell  or  Mr. 
Conrad  since  November  19867 

A    Yes. 

Q    When  was  the  first  such  contact  after  November? 

A    Mr.  Channell  retained  IBC  again  in  November  to 
assist  in  his  relations'  effort,  and  we  continued  that 
relationship  until  April,  I  believe. 

Q    Of  this  year7 

A    Of  this  past  year;  that's  right. 

Q    Aside  from  any  efforts  of  IBC's  on  his  behalf  with 
respect  to  that  professional  relationship,  did  you  have  any 
discussions  with  Mr.  Channell  after  November  1986  about  your 
respective  participation  in  what  I  am  referring  to  as  the 
contra  funding  network? 

A    Well,  sure.   I  presented  the  report  to  him.   He 


in  wnac  i  am  rererring  to 


asked  continually  for  as  much  documentation  as  could  be 


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provided.   And  I  sought  that  documentation  from  the  recipients 
of  the  assistance,  and  I'm  sure  we  discussed  it. 

Q    What  prompted  the  February  1987  report,  a  portion 
of  which  was  marked  yesterday  as  Exhibit  17? 

A    Dan  Conrad  had  been  asking  for  about  nine  or  ten 
months  for  a  full  report  of  the  1985/86  expenditures,  and 
there  simply  was  not  during  the  period  in  which  we  were 
working  for  Mr.  Channell  time  to  do  it,  since  I  was  the 
individual  that  would  have  to  do  95  percent  of  the  work 

And  finally  in  November  it  became  clear  to  me  that 
he  would  need  a  report  for  tax  purposes  and  for  purposes  of 
talking  to  his  own  contributors,  and  so  I  worked  I  have  no 
idea  how  many  hours,  but  virtually  every  night  and  all 
weekends  for  some  time  mid-November  probably  until  the  report 
was  issued  in  February. 

Q    Did  you  discuss  the  substance  of  the  report  with 
Channell  or  Conrad  before  you  actually  gave  the  report  to  him? 
-  A    No. 

Q    You  and  I  talked  yesterday  about  some  of  the 
conclusions  in  the  report  that  are  on  page  3  of  Exhibit  17. 
Did  you  review  these  conclusions  drawn  with  anyone  prior  to 
giving  the  report  to  Channell? 

MR.  DUDLEY:   Other  than  counsel. 
BY  MR.  KAPLAN: 

Q    Other  than  counsel? 


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No. 


Q    Were  these  conclusions  in  the  report  when  Colonel 
North  reviewed  the  report  in  your  meeting  with  him  and  in 
your  meeting  with  him  and  counsel  in  February  1987? 

A    Yes. 

Q    Did  Colonel  North  comment  at  all  about  the  con- 
clusions that  we  discussed  yesterday? 

A    He  made  no  comment  about  it,  but  I  remember 
specifically  his  counsel  saying  that  they  took  no  position  on 
any  of  the  characterizations. 

Q    Did  Mr.  Gomez  review  the  report  before  it  was 
turned  over  to  NEPL? 

A    I  don't  believe. 

Q    Did  you  discuss  the  conclusions  drawn  with  him 
prior  to  distribution  to  NEPL? 

A    I  don't  think  so. 

Q    Have  you  discussed  those  conclusions  with  Mr.  Gomez 
after  the  issuance  of  the  report? 

A    I  may  have,  but  I  don't  recall  specifically. 

Q    And  did  you  discuss  the  conclusions  with  Mr. 
Channel  or  Mr.  Conrad  after  the  issuance  of  the  report? 

A     No. 

Q    You  mentioned  yesterday  that  you  met  -- 

A    Can  I  take  a  break? 
MR.  KAPLAN:   Fine. 


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[Brief  recess . ] 
BY  MR.  KAPLAN: 

Q    I  believe  that  you  testified  yesterday  that  you  met 
David  Fischer  some  time  in  December  of  1985. 

A    I  think  I  may  have  met  him  in  November  or  some  time 
at  the  end  of  the  year. 

Q    Do  you  recall  who  introduced  you  to  Mr.  Fischer? 

A    Marty  Artiano. 

Q    How  did  you  know  Mr.  Artiano? 

A    I  knew  Marty  from  the  campaign.   We  had  a  casual 
acquaintance  during  the  campaign. 

Q    Which  campaign  are  you  talking  about? 

A    The  Reagan/Bush  1979-80  campaign.   And  I  subsequent- 
ly got  to  know  Mr.  Artiano  better  when  he  was  working  at  the 
State  Department  and  subsequently  to  his  leaving  the  State 
Department  and  becoming  a  partner  at  Anderson,  Hibey,  Narheim 
and  Blair. 

Q    Did  you  work  with  Mr.  Artiano  at  the  State  Depart- 
ment? 

A    We  had  some  contact.   His  position  there  was  in  the 
Office  of  International  Organizationo  and  AID  has  a  fair 
amount  of  work  with  the  Office  of  International  Organizations. 

Q    Did  Mr.  Artiano  introduce  Mr.  Fischer  to  you  for  a 
particular  purpose,  at  least  as  far  as  you  know? 

A    Yes.   I  tvtfita%t^i^^d  A  Sf  Sttb^'SC  either  a  consulting 


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organization  to  take  over  the  account  completely  or  to  find 
somebody  that  would  be  willing  to  work  together  with  us  on 
the  account  for  Mr.  Channell.   And  it  was  contact  with  Mr. 
Artiano  that  led  to  the  conversations  with  Mr.  Fischer  and 
himself . 

Q    By  the  account,  you  are  referring  to  the  NEPL 
account? 

A    All  the  Channell  organizations. 

Q    Okay. 

What  was  your  interest  in  Mr.  Fischer  particularly? 

A    We  had  gotten  to  a  point  with  Mr.  Channell  where  we 
were  not  able  to  increase  his  level  of  efficiency  and 
programs  with  our  stature,  and  we  needed  somebody  of  greater 
stature  to  accomplish  that.   And  that  was  our  reason  for 
seeking  senior  consultants  to  do  that. 

Q    What  did  you  learn  about  Mr.  Fischer's  background 
upon  meeting  him? 

A    I  knew  exactly  who  David  Fischer  was  before  I  ever 
met  him.   He  was  as  well  known  to  campaign  people  as  would 
have  been  Lyn  Notziger  or  Ed  Meese  or  anybody  like  that. 

Q    What  was  Mr.  Fischer's  pos^.tion  in  the  White  House? 

A    He  was  President  Reagan's  personal  assistant. 

Q    Did  IBC  and  Mr.  Fischer  conclude  a  business 
relationship  some  time  in  November  or  December  of  1985? 

A      Yes.  !}Mf^Mf^^?'r!iri 


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Q    What  was  the  relationship  that  you  arrived  at? 
A    Mr.  Fischer  and  Mr.  Artiano  were  retained  by  IBC  to 
work  on  initially  the  Channell  account,  and  their  services 
would  include  the  arrangement  of  briefings  for  Mr.  Channell 
and  his  people  with  senior  officials,  policymakers,  policy 
implementation  offices  for  the  arrangement  of  briefings  by 
senior  Administration  officials  or  Mr.  Channell  and  by  Mr. 
Channell  to  senior  Administration  officials  and  policymakers. 
They  were  responsible  from  that  period  forward  for 
most  of  the  senior-level  contacts  within  the  Administration, 
Congress.   They  provided  some  advice  and  counsel  on  strategic 
planning,  reviewed  texts  for  proposed  programs,  made  recommen- 
dations as  to  how  to  improve  the  success  of  the  programs. 
They  wrote  planning  memoranda  and  at  some  points  I  think  they 
worked  on  talking  points.   That's  all  off  the  top  of  my  head. 
Q    What  was  the  initial  financial  arrangement  of  your 
relationship  with  Mr.  Fischer  and  Mr.  Artiano? 

A    Mr.  Fischer  and  Mr.  Artiano  asked  initially  for 
$20,000  a  month  with  a  long-term  commitment.   It  didn't  take 
them  very  long  to  realize  how  demanding  Mr.  Channell  was,  and 
for  them  to  continue  the  effort,  they  required  that  I 
guarantee  to  them  two  years'  worth  of  retainer,  which  I 
agreed  to  do.  Since  that  was  money  X  would  have  gotten  from 
Mr.  Channell  in  order  to  guarantee  it,  I  left  it  up  to  them 
to  make  calls  for  i^*«<iifi.tjritui.iQn.aj3d_Sver  the  course  of  the 


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next  six  to  eight  months,  I  charged  Mr.  Channell  sufficient 
fees  to  be  able  to  meet  that  guarantee. 

Q    What  was  Channell 's  understanding  as  to  the  fee 
basis  that  you  had  arranged  with  Fischer  and  Artiano? 

A    I  told  him  —  and  I  remember  a  conversation  in  my 
office  at  my  conference  table  with  Mr.  Channell  —  that  I  was 
going  to  charge  him  $20,000  a  month  plus  $50,000  a  month  and 
he  was  actually,  I  think,  kind  of  disturbed  by  that.   But  I 
also  explained  to  him  that  he  wanted  the  level  of  effort  that 
he  had  outlined,  that  that  was  going  to  be  what  was  required 
and  he  accepted  it  and  paid  it  out  over  actually  I  think  a 
period  of  about  eight  months.   That  may  be  a  shorter  length 
of  time,  maybe  six  months. 

Q    Is  it  fair  to  say  that  you  had  almost  daily  contact 
with  Mr.  Fischer  with  respect  to  his  carrying  out  of  the 
services  under  your  business  arrangement  with  him  from 
December  1985  forward? 

A    I  would  use  the  term  daily  because  it  included 
nights  and  weekends.   It  was  an  extremely  demanding  period  of 
time. 

Q    Did  Mr.  Fischer  work  out  of  your  offices? 

A    No.   For  a  period  of  time,  he  worked  out  of  Mr. 
Artiano 's  office.   He  also  was  still  living  in  Salt  Lake 
City.  So  he  would  fly  to  Washington,  and  when  he  was  in 
Washington,  ■^"•"a^y"fTh  b°  j-'^i^j  iWrJ'mmt   of  IBC's  offices. 


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Q    With  what  regularity  did  you  have  contact  with  Mr. 
Artiano  during  this  same  period  of  time,  that  is  from 
December  1985  forward? 

A    Initially,  I  would  say  probably  daily. 

Q    For  how  long? 

A    I  don't  know,  probably  the  first  three  months  or 
so,  four  months.   And  then  my  contacts  gravitated  more  to  Mr. 
Fischer. 

Q    Did  you  receive  bills  from  Mr.  Fischer  or  Mr. 
Artiano  or  both  for  payment  of  these  monthly  retainers? 

A    No.   I  left  it  up  to  them  to  make  cash  calls  on  us. 
Since  it  was  agreed  upon  $20,000  a  month,  there  was  no  need 
for  any  elaborate  mathematics.   I  simply  knew  how  much  money 
they  had  coming,  and  they  were  allowed  to  call  on  it  any  time 
they  wanted  to. 

Q    When  you  contacted  Mr.  Artiano,  did  you  contact  him 
at  his  law  office? 

A    Yes. 

Q    And  that  would  have  been  daily  contact  for  at  least 
a  period  of  months  after  and  including  December  1985? 

A    That's  correct. 

Q    Did  Mr.  Artiano  —  strike  that  question. 

What  was  the  form  of  payment  that  you  made  to 
Fischer  and  Artiano  pursuant  to  this  business  arrangement? 

A    Both  checks  and  wires 


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507  C  Stictt.  N  E  25 

Wuiiiii|ion.  D  C      20002 
(202)  »6-it6t 


UNCLASSIFIED 


345 


Q    How  come  wires? 

A    No  particular  reason. 

Q    Would  there  be  wires  to  Mr.  Fischer  in  Salt  Lake 
City? 

A    Either  to  his  account  in  Salt  Lake  City  or  to  Mr. 
Artiano's  account  in  Washington. 

Q    Were  your  checks  made  to  Mr.  Fischer  personally,  or 
were  they  made  to  David  C.  Fischer  and  Associates? 

A    I  don't  really  remember.   It's  academic. 

Q    Just  so  we  can  clarify  for  the  record,  I  take  it 
that  you  made  —  of  this  $20,000  a  month,  did  you  make  a 
portion  of  that  $20,000  by  payment  to  Mr.  Fischer  and  a 
portion  of  that--to  Mr.  Artiano  each  month,  or  did  you  make  a 
lump  sum  payment  that  they  split  amongsti themselves? 

A    Initially,  I  made  lump  sum  payments  that  they  split 
eunongst  themselves,  and  then  it  was  up  to  each  one  of  them  to 
make  cash  calls.   And  whatever  their  cash  call  was,  that  is 
wha^  I  paid,  simply  that  their  request  for  payment  was  met  by 
a  payment. 

Q    Were  payments  to  Mr.  Artiano  made  to  htm  personally, 
to  the  best  of  your  recollection? 

A    I  think  so. 

Q    Did  you  eveiL  make  any  payments  to  the  law  firm  of 
Anderson-Hibey? 

A    I  think  I  made  a  payment  to  Anderson.   No,  I  don't 


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think  I  have  ever  made  a  payment  to  Anderson. 

Q    Did  you  have  meetings  with  Mr.  Artiano  during  the 
first  month  after  the  beginning  of  the  relationship? 

A    Yes. 

Q    Where  did  those  meetings  typically  take  place? 

A    Well,  when  they  were  just  regarding  our  client, 
they  would  have  been  at  IBC  or  at  his  office. 

Q    When  you  say  "his  office",  you  are  referring  to  his 
office  at  Anderson-Hibey? 

A    Yes.   And  I  also  attended  some  meetings  with  him 
that  he  and  Mr.  Fischer  had  set  up  with  officials  or  policy 
offices,  and  those  would  have  been  outside  our  offices. 

Q    How  long  did  Mr.  Fischer  maintain  offices  at  Mr. 
Artiano' s  law  firm? 


I  couldn't  say  for  certain.   I  can't  place  a  time 


on  it. 


Q  Did  he  have  a  separate  office  at  the  law  firm? 

A  I  don't  know. 

Q  what  was  your  understanding  as  to  the  relationship, 

if  any,  between  Mr.  Fischer  and  the  law  firm  of  Anderson- 
Hibey? 

A  I  don't  think  there  was  a  relationship. 

Q  Other   than   tie.^ct   tjja^  hehad  an  office   there   — 

A  Yes .                     I 

Q  —  at  least  for  a  period  of  time. 


'£.*»  that   he   had  an  o 

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>07  C  Sucti.  N  E  25 

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(!0!|  M«-6«< 


uNcussra 


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Was  there  a  time  when  Mr.  Fischer  took  up  an  office 
residence  at  IBC's  offices? 

A    Yes . 

Q    When  did  that  occur? 

A    In  late  June  or  July  of  1986. 

Q  So  that  was  some  time  around  the  time  that  IBC  and 
David  C.  Fischer  and  Associates  entered  into  a  joint  venture 
arrangement? 

A    That's  right. 

Q    Do  you  recall  what  the  total  fees  were  that  were 
paid  to  Fischer  and  Artiano  over  the  course  of  your  relation- 
ship with  them?  Well,  strike  that. 

Do  you  recall  what  the  total  fees  that  were  paid  to 
Fischer  and  Artiano  pursuant  to  this  business  relationship 
that  was  struck  between  IBC  and  them  in  December  of  1985? 

A    It  would  have  been  about  $480,000. 

Q    And  do  you  recall  when  those  fees  were  paid? 

A    Over  the  course  of  the  next  probably  eleven  or 
thirteen  months . 

Q    Was  there  a  time  when  the  fee  payments  of  $20,000  a 
month  were  accelerated  by  IBC? 

A    Well,  they  had  the  right  to  accelerate  it  any  time 
they  wanted  to,  depending  on  **h*t  .tbej.r_naed3_were^   It  was 
for  me  a  singular  commitment. 

Q     So  that  if  I  understand  you  correctly,  in  December 


WDiWD" 


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of  1985  you  guaranteed  to  Fischer  and  Artiano  $20,000  a  month 
and  you  guaranteed  to  them  payment  for  24  months  running  from 
that  time. 

A    Correct. 

Q    And  if  my  multiplication  serves  me  correct,  that  24 
months  times  $20,000  comes  to  $480,000.   Is  that  correct? 

A    That's  correct. 

Q    So  that  there  was  a  lump  sum  arrangement  in 
December  1985  of  $480,000  payable  to  them.   Is  that  correct? 

A    That's  correct. 

MR.  DUDLEY!   I  have  a  little  trouble  with  the 
phrase  "lump  sum"  there.   There  was  a  total  commitment  to  pay 
that. 

MR.  KAPLAN!   I'll  take  that  clarification. 
BY  MR.  KAPLAN: 

Q    Was  there  a  total  commitment  made  in  December  1985 
that  IBC  would  pay  Fischer  and  Artiano  that  amount,  pretty 
mucli  regardless  of  what  happened? 

A    Well,  as  long  as  they  continued  to  work  with  the 
client. 

Q    Okay.   And  that  was  part  of  the  understanding  in 
your  original  relationship.] 

A    Yes. 


UNCLASSIFIED 


Q    And  pursuant  to  that  total  commitment  though,  as  I 
understand  your  testimony,  is  it  correct  to  say  that  Fischer 


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WnhmfTon.  DC     20002 
(202)  V««-MM 


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and  Artiano  had  the  right  to  call  upon  IBC  to  make  payments 
of  amounts  up  to  that  $480,000  at  any  time  during  their 
performance  of  services  under  that  original  business  relation- 
ship? 

A    Well,  they  had  the  right,  but  obviously,  if  they 
had  stopped  doing  the  work,  we  would  have  not  been  eunenable 
to  the  call. 

Q    Right.   But  assuming  that  they  did  continue  to  do 
the  work  — 

A    Yes,  they  had  the  right  to  call,  and  they  did  on 
occasion  call  for  large  sums. 

Q     If  they  had  come  to  you  three  months  into  the 
relationship  and  called  on  the  entire  $480,000,  would  IBC 
have  paid  to  them  under  the  terms  of  their  relationship  that 
$480,000? 

MR.  DUDLEY:   Objection;  that  is  speculative. 
THE  WITNESS:   Yes.   That's  a  hypothetical.   I 
wouldn't  answer  i^. 

BY  MR.  KAPLAN: 

Q    Was  there  a  time  in  which  they  called  more  than 
$20,000  a  month? 

A    I  think  there  was  at  least  one  occasion  —  well, 
maybe  as  many  as  two  or  three. 

Q    Did  IBC  pass  through  all  the  payments  to  Fischer 
and  Artiano  to  NEPL? 


UNCLASSIFIED 


355 


507  CStnn.  N  E. 
VMhjaitoo,  DC 
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Do  you  understand  what  1  am  asking? 

A    No. 

Q    Was  NEPL  charged  for  Fischer  and  Artiano's  services 
that  IBC  paid  for? 

A    Yes. 

Q    In  total? 

A    In  regards  to  the  client  relationship  that  we 
discussed  earlier,  yes.   There  was  an  additional  relationship 
at  a  later  point  in  tiroe. 

Q    Okay,  which  didn't  involve  NEPL? 

A    No.   It  involved  IBC  clients  in  general. 

Q    I  see.   And  the  $480,000  that  was  paid  to  Fischer 
and  Artiano  under  this  original  business  relationship  that 
was  struck  in  December  of  1985,  was  that  $480,000  charged  to 
NEPL  by  IBC? 

A    That's  correct. 

Q    Okay . 

•DJ-d  you  have  an  understanding  that  Fischer  and 
Artiano  were  being  paid  based  on  a  number  of  meetings  with 
the  President  that  they  were  able  to  arrange? 

A    No. 

Q    Do  you  know  whether  anyone  else  had  that  understand- 
ing? 

A    At  some  point~we  "actually  ITeld  a~meeting  because 
Spitz  or  Dan  Conrad  —  I  have  forgotten  which  —  had  said 


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Hiixin  nromma  co..  mc. 

)07  C  Street.  NE  2  5 

Wuhuiioo.  DC     20C02 
(202)  Ht-iUt 


UNCLASSIRED 


351 


something  similar  to  that,  and  we  actually  held  a  meeting  in 
my  conference  room,  in  which  Marty  Artiano  quite  avidly 
dissuaded  them  of  that  notion,  and  I  remember  him  saying  "I 
have  no  idea  how  this  got  started  but  I  want  it  to  be  clear 
that  that's  not  why  we  were  brought  into  this."   And  it  was 
agreed  that  that  was  the  case,  and  the  meeting  was  ended. 

Q    When  did  that  meeting  take  place? 

A    We  were  in  our  new  office.   So  it  had  to  be  after 
January . 

Q 

A 

Q 

A 


Of  1986? 
Yes. 

What  was  Channell's  response? 

I  don't  think  he  particularly  liked  the  direct 
nature  that  Marty  used  to  discuss  it  with  him,  and  aside  from 
that,  I  think  he  was  in  agreement. 

MR.  McGOUGH:   Would  you  mind  if  I  interjected  here 
because  I  have  the  sequence  I  think  a  little  more  clearly. 
MR.  KAPLAN:   Go  right  ahead. 

EXAMINATION  BY  COUNSEL  FOR 
THE  SENATE  SELECT  COMMITTEE 
BY  MR.  McGOUGH: 
Q    There  was  originally  the  agreement  for  $20,000  a 


month.   Is  that  correct? 


iU 


A    Correct. 

Q    There  then  was  a  meeting  you  had  wITJT'Mr.  Channell 


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M7  C  Strcn.  N  E  25 

Wuhinitoo.  DC     20002 
(202)  M«.««M 


UNCLASSIFIED 


352 


that  you  mentioned  before  at  a  conference  table  where  you 
told  him  that  over  the  next  six  months  you  were  going  to 
charge  him  $20,000  a  month  plus  $50,000  a  month. 

A    That's  correct. 

Q    When  did  that  meeting  take  place? 

A     It  had  to  be  in  December  because  we  were  in  our  old 
offices. 

Q    So  you  had  the  meeting  in  December  where  you  told 
him  that  was  the  arrangement.   What  was  his  response  to  that 
offer  or  request? 

A    He  wasn't  happy  about  it. 

Q    I  think  you  said  December  of  1986.   You  mean 
December  of  1985. 

A    Correct . 

Q    Did  he  ask  you  anything  about  what  Fischer  and 
Artiano  might  do  in  exchange  —  or  if  he,  in  fact,  were  to 
pay  $70,000  a  month?  Did  he  ask  you  anything  about  their 
capabilities? 

A    Your  time  frames  are  reversed  because  he  was  the 
one  that  set  the  work  product  necessary  to  his  program.   So 
he  had  already  identified  what  he  wanted  to  have  done. 

Q    There  was  a  time  when  he  thought  he  was  going  to 
pay  $20,000  a  month.   Is  that  right? 

A  Initially,   when  I   spoke  to  Mr.   Artiano  and  Mr. 

Fischer,    we  were  talking, fltyjiiJ^  $20^^ 


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)07CStRn.  NE  25 

Wuhiniioo.  D  C     20002 
(202)  i*6-tUt 


UNCUSSIFIED 


353 


Q    And  did  you  relay  that  on  to  Mr.  Channel 1? 

A    I  think  initially  I  did  relay  that  to  Mr.  Channell. 

Q  Then  you  came  back  in  December  of  1986  and  said 
that  for  the  next  six  months  you  were  going  to  charge  him 
$20,000  a  month  plus  $50,000  a  month., 

A    Correct. 

Q    And  Mr.  Channell  wasn't  happy  with  that. 

A    That's  correct. 

Q    Did  Mr.  Channell  ask  you  anything  about  Presidential 
meetings  at  that  meeting  in  December  of  1986  --  1985.   I'm 
sorry. 

A    He  may  well  have.   I  don't  have  a  specific  recollec- 
tion, but  again  you  have  got  the  cart  before  the  horse.   I 
don't  want  to  use  any  particular  analogy. 

The  work  product  that  Mr.  Channell  was  demanding 
had  already  been  discussed  prior  to  that  meeting. 

Q    I  understand  that,  and  I  understand  that  Presiden- 
tial meetings  may  well  have  been  discussed  prior  to  that 
meeting.   But  my  question  is:   When  you  broached  that 
proposal  with  him  in  December  of  1986,  the  proposal  being 
$20,000  plus  $50,000  —  in  1985  —  wiien  you  broached  that 
proposal  in  December  of  1985  for  $20,000  plus  $50,000,  did  he 
ask  in  response  anything  about  Presidential  meetings? 

A    Again,  not  that  I  specifically  recall,  but  Presiden- 
tial meetings  were  pi:tth  ff £^ fch%  Qf  e^ious  discussion  of  the 


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■•U.IIt  NfKMtTWO  CO.,  MC. 
507CSire«.  NE  25 

Wuhinfion.  O  C.    20002 
(202)  Mt-MM 


UNcussra 


354 


work  product  that  he  needed.   So  it  is  entirely  possible  but 
I  don't  recall  a  specific  exchange  on  it. 

Q    Do  you  recall  a  specific  exchange  involving  whether 
or  not  he  would  receive  for  Presidential  meetings  over  the 
next  four  months? 

A    I  remember  he  wanted  the  President  at  events  over 
the  next  four  months,  and  I  think  ultimately  six  or  eight 
months.   But  he  --  yes. 

Q    That  was  at  the  December  1985  meeting. 
A    Yes. 

Q    And  what  did  you  tell  him  about  the  President's 
availability  over  the  next  four  months  or  six  months?   I 
mean,  did  you  tell  him  that  you  would  have  to  check  with 
Fischer  and  Artiano  as  to  whether  that  was  possible? 

A    I  don't  recall  whether  I  said  that  to  him  or  not. 
Q    Did  you  make  any  response  at  all  to  him? 
A    Again,  I  don't  recall  the  specific  exchange.   So  I 
don't  recall.   But  again,  he  understood  going  into  that 
meeting  that  he  was  requesting  as  part  of  his  work  product 
meetings  with  the  President. 

Q    I  understand  that.   But  I  sm  focusing  on  the 
December  meeting,  and  all  I  want  to  know  is  whether  you  have 
a  recollection  as  to  that  meeting  of  Mr.  Channell  asking  in 
response  to  your  proposal  for  $70,000  a  month  about  the 
President's  availability  for  meetings  over  that  same  time 


\mmm 


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ONClASSinED 


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period,  over  the  next  four  to  six  months? 

A    I  don't  have  a  specific  recollection. 

Q    Did  Mr.  Channell  agree  to  that  amount  at  that 
meeting,  or  did  you  have  to  go  back  and  get  further  informa- 
tion from  Mr.  Artiano  and  Mr.  Fischer? 

A    I  recall  him  agreeing  at  the  meeting.   In  fact,  I 
recall  him  leaning  on  my  fireplace  and  saying  he  was  not 
happy  about  it,  but  that  he  was  willing  to  pay  it. 

Q    Did  he  indicate  what  he  expected  in  exchange  for 
the  additional  payment? 

A    I  don't  remember  a  specific  exchange  about  what  he 
expected  for  the  additional  payments. 

Q    Did  you  come  away  with  a  sense  that  he  expected  any 
additional  effort  on  the  part  of  Mr.  Fischer  or  Mr.  Artiano 
or  any  tangible  work  product  from  that? 

A    Yes,  but  it  wasn't  any  different  than  the  same 
expectations  going  into  the  meeting. 

Q    So  you  don't  recall  him  having  any  additional 
expectations  for  the  additional  $50,000  per  month? 

MR.  DUDLEY:   "Additional"  may  be  wrong  here'.   It  is 
escalated  $50,000. 

MR.  OLIVER:  He  used  the  word  "additional"  earlier. 
MR.  DUDLEY:   I  know  he  did  and  I  let  it  go  by  and  I 


shouldn't  have. 


BY  MR.  McGOUGH: 


UNCLASSIFIED 


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(202)  Vt6-6M« 


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356 


Q  I  am  trying  to  understand  you  had  struck  a  deal  in 
November  to  provide  certain  services,  in  November  of  1985  to 
provide  certain  services  for  $20,000  a  month. 

A     Right. 

Q    Within  one  month  you  come  back  — 

A    In  probably  less  than  one  month. 

Q    In  probably  less  than  one  month  you  come  back  and 
say,  "No,  the  price  is  now  $70,000  per  month."   I'm  trying  to 
get  at  whether  in  exchange  for  that  increase  in  at  least 
monthly  installments  or  that  compression  of  the  money  whether 
Mr.  Channell  spoke  in  terms  of  additional  results  or  addition- 
al effort  or  additional  work  product  from  Mr.  Fischer  or  Mr. 
Artiano.   Or  did  he  say,  "No,  that's  okay;  I  will  pay  $70,000 
for  what  I  originally  thought  we  were  going  to  get  for 
$20,000." 

A    Again,  counsel,  I  am  not  trying  to  be  evasive  but 
the  meeting  was  predicated  on  the  fact  that  there  was  a  great 
increase  in  the  amount  of  effort  that  Mr.  Channell  expected 
over  the  next  six  months.   And  it  was  my  requirement  that  he 
pay  this  extra  money  associated  with  that  effort. 

Q    So  it  was  Mr.  Channell  who  had  set  the  predicate 
for  the  meeting  as  being  additional  effort  over  the  next  six 
months? 

A    Oh,  yes. 

Q    What  were  the  additional  efforts  that  he  was  asking 


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for  over  the  next  six  months? 

A    Well,  initially  when  we  went  to  Fischer  and 
Artiano,  first  of  all,  we  had  to  retain  them  to  even  begin 
the  discussions.   So  that  I  remember  clearly.   And  initially 
they  thought  they  were  doing  mostly  advice  and  counsel.   When 
it  became  clear  early  on  in  their  first  meetings  with  Mr. 
Channell  that  he  had  a  very  long  agenda  with  a  lot  of  work 
elements  associated  with  it,  that  required  a  lot  of  time  on 
their  part  and  a  lot  of  contact  with  very  senior  officials 
and  their  credibility  on  the  line  and  so  forth.   That's  when 
they  suggested  that  they  were  going  to  have  to  have  a  two- 
year  commitment  from  me,  and  I  agreed  to  that. 

This  is  all  within  probably  one  to  three  weeks. 

Q    All  right.   This  was  before  a  deal  was  struck  for 
$20,000  a  month  for  two  years. 

A    At  that  point,  the  deal  was  struck  for  $20,000  a 
month  for  two  years. 

Q    We're  at  that  point. 

A    Right. 

Q    I'm  just  trying  to  follow  the  sequence  through. 
The  coming  up  on  this  meeting  in  December  of  1985,  Mr. 
Channell  made  additional  demands  on  them. 

A    I  guess  my  problem  is  that  I  am  looking  at  a 
maximum  of  three  weeks,  probably  about  a  two-week  period 
where  it  became  clear  that  the  ampuat.of .^ork  that  Mr. 


mM 


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VuhinftMi.  D  C     2000: 
(202)  M«-MM 


358 


Channell  was  requiring  was  greatly  in  excess  of  what  he  had 
conveyed  to  anyone  before. 

Q    I  know  we  have  to  focus  on  that.   What  I  am  trying 
to  get  at  is  the  difference  between  the  work  he  had  conveyed 
before  and  the  work  that  now  led  up  to  this  December  1985 
meeting  where  the  payments  were  compressed.   What  was  the 
difference  in  what  he  was  asking  before? 


Before  all  he  was  asking  for  was  advice  and  counsel, 

Advice  and  counsel  on  what? 

On  his  programs,  just  on  the  substance  of  his 

And  it  didn't  involve  Executive  Branch  liaison? 

No. 

It  didn't  involve  setting  up  meetings  with  the 


A 
Q 
A 

programs 

Q 

A 

Q 
President? 

A    No. 

Q    After  in  that  two  to  three-week  period  leading  up 
to  the  December  1985  meeting,  he  changed  or  he  increased  the 
demands  upon  them.   Fair  enough? 

A    1  will  give  you  that  if  you  don't  keep  your  list 
only  two  items  long. 

Q    Fine.   But  he  made  additional  demands. 

A    Right. 

Q    And  was  ^h®|Q¥S*iCg^%  JS^V^rfWW^®^  1985  meeting? 
A    Right 


mSKET 


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Mum  NvotmMo  co..  mc. 

507  C  Strew.  NE  25 

Wuhugtoa.  DC     20002 
(201)  W>-*tU 


wmm 


359 


Q    And  at  the  December  1985  meeting  one  --  or  leading 
up  to  the  December  1985  meeting,  one  of  the  additional 
demands  was  Executive  Branch  liaison? 

A    That's  correct. 

Q    And  one  of  the  additional  demands  was  assistance  in 
setting  up  meetings? 

A    That's  correct. 

Q    And  there  were  other  demands  as  well. 

A    A  tremendous  number  of  other  demands. 

Q    A  tremendous  number  of  other  demands .   And  in 
exchange  for  those  additional  efforts  you  asked  for  an 
increase  in  the  monthly  payments  from  $20,000  a  month  to 
$70,000  a  month  over  the  next  — 

A    Correct. 

Q     —  six  months.   And  in  that  context  was  there  any 
discussion  of  the  number  of  Presidential  meetings  that  Mr. 
Fischer  or  Mr.  Artiano  might  be  able  to  set  up  over  the 
coucse  of  the  next  four  to  six  months? 

A     I  don't  remember  a  specific  exchange  about  the 
number  of  Presidential  meetings.   I  recall  that  Mr.  Channell 
was  anticipating  having  af .i€>^5f. orie^\ieiit;_4  jnQflth  like  the 
one  he  had  in  January. 

Q    And  did  he  inquire  whether  or  not  the  President  -- 
whether  or  not  Mr.  Fischer  or  Mr.  Artiano  might  be  able  to 
arrange  for  the  presence  of  the  President  at  one  or  more  of 


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JOTCSlMtl.  NE  25 

Wuhinfion.  D  C     20002 
(202)  V««-«M« 


UNCUSSIHED 


360 


those  events  which  would  work  out  to  one  or  more  a  month  over 
the  next  six  months? 

A    I  don't  recall  a  specific  exchange  as  you  have  just 
characterized . 

Q    But  the  schedule  for  the  events  over  the  next  six 
months  was  certainly  a  topic  of  conversation,  was  it  not? 

A    Mr.  Channell  had  anticipated  having  one  of  these 
events  one  a  month  for  the  next  six  —  originally  four  months 
and  then  six  months. 

Q    And  he  wanted  the  President  to  attend  those,  did  he* 
not? 

A     If  possible,  yes. 

Q    And  at  some  point  you  would  have  discussed,  would 
you  not,  with  Mr.  Fischer  and  Mr.  Artiano  their  ability  to 
arrange  for  the  President's  presence  at  those  meetings. 
Correct? 

A    I  think  you  have  to  rephrase  your  question. 
_  Q    I  guess  what  I  am  saying  is  you  would  have  asked 
thm,  "Hey,  Marty,  hey,  Dave,  Channell  plans  a  series  of 
events  over  the  next  six  months.   Is  there  any  chance  you 
could  have  the  President  attend"  or  -omething  to  that  effect. 

A    I  think  it  was  more  a  matter  of  us  laying  out  or  me 
laying  out  for  Marty  and  David  the  total  agenda  that  Channell 
had  over  the  next  six  months,  and  they  felt  confident  that 
they  could  help  meet  it. 


UNCUSSIRED 


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507CStrttT.  NE  25 

Vuhinfiofi.  D  C     20002 
(W2)  M4-MM 


ONCLASSm 


361 


Q    And  that  agenda  included,  at  least  ideally, 
arranging  for  the  President  to  attend  Channell's  events. 

A    Well,  there  were  a  lot  of  ideal  items  on  it,  and 
several  which  never  happened. 

Q    I  understand.   But  one  of  the  items  would  have  been 
that. 

A    Yes. 

Q    And  you  would  have  discussed  those  ideals  with  Mr. 
Artiano  and  Mr.  Fischer,  would  you  not? 

A    We  would  have  discussed  the  agenda  in  general .   I 
don't  think  I  would  have  ever  questioned  whether  or  not  they 
could  deliver  on  the  agenda  if  they  said  they  could. 

Q    But  they  would  have  indicated  that  they  could 
deliver.   You  said  you  wouldn't  have  questioned  them  if  they 
said  they  could.   Did  they  indicate  that  they  could  do  that? 

A    You  and  I  have  used  "if"  and  "would"  about  ten 
times  in  the  last  three  sentences,  and  I  am  telling  you  I 
donjt  recall  a  specific  exchange,  and  I  just  want  to  leave  it 
at  that.   I  mean,  I  don't  think  I  would  have  challenged  them 
on  whether  or  not  they  could  deliver  on  something.   I  don't 
think  I  would  have  ^sked  them^Decy.tica]J.v  whptjier  they  could 

deliver  on  something  UNbLAOoll  IlU 

Q    Would  they  have  told  you  about  their  capabilities 
as  far  as  bringing  the  President  to  Mr.  Channell's  events? 

MR.  DUDLEY:   I  object  to  the  form  of  the  question. 


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VuhuiiToa.  0  C     20002 
(202)  Ht-i66i 


362 


I  will  let  him  answer  did  they  tell  you. 
BY  MR.  McGOUGH: 
Q    Did  they  tell  you? 
A    I  don't  recall  them  specifically  telling  me  that. 

MR.  McGOUGH:   I  think  I  have  pretty  well  played  out 
that. 

MR.  KAPLAN:   I  just  have  two  follow-up  questions  on 
that  area,  and  then  I  want  to  move  on. 

EXAMINATION  BY  COUNSEL  FOR 
THE  SENATE  SELECT  COMMITTEE  (Resximed) 
BY  MR.  KAPLAN: 
Q    Did  Mr.  Channell  tell  you  in  this  meeting  that 
occurred  in  early  1986  how  he  arrived  at  the  understanding 
that  he  apparently  had  arrived  at  that  he  would  be  paying 
$50,000  for  meetings  that  could  be  set  up  with  the  President? 

A    I  don't  think  what  we  were  trying  to  dissuade  him 
of  was  that  he  was  paying  $50,000  a  meeting.   What  we  were 
trying  to  dissuade  him  of  was  that  the  sole  reason  he  had 
hired  Mr.  Fischer  was  to  set  up  meetings  with  the  President. 

Q    Did  Channell  tell  you  how  he  arrived  at  that 
understanding? 
A    No. 

Q    How  did  you  learn  that  Channell  was  holding  this 
understanding  of  hi  §  Jipgii»§ss_  relationship  with  Fischer  and 
Artiano? 


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507  C  Sirm.  N  E  25 

Tuhuifion.  O  C     20002 
(202)  146-66M 


INCUSSIHED 


363 


A    I  think  it  was  an  errant  comment  made  by  him  to 
either  Mr.  Fischer  or  myself  or  Mr.  Artiano. 

Q    Okay.   And  that's  what  gave  rise  to  the  meeting? 

A    Yes.   It  was  an  attempt  to  nip  it. 

Q    And  you  described  the  meeting  earlier  in  your 
testimony  here  today. 

A    Yes. 

Q    Let ' s  move  on . 

Do  you  know  a  Richard  Secord? 

A    Well,  I  met  him  on  the  street  one  time  and  I  talked 
to  him  on  the  phone  three  times . 

Q    When  did  you  meet  him  on  the  street? 

A    About  a  week  ago. 

Q    How  did  that  meeting  come  about?   Was  it  a  chance 
meeting? 

A    It  was  very  chance  and  it  was  a  simple  handshake 
and  a  wish  for  good  luck  to  both  of  us. 

Q    Did  he  know  who  you  were  when  you  introduced 
yourself? 

A     I  don't  think  he  recognized  me  immediately  but 
shortly  I  think  it  dawned  on  him  who  I  was. 

Q    Did  you  "13^4  thi-V#il  ^^nFJiFt9^  §^9SP^^'-^   around 
Dupont  Circle?       UsiyLM^ 

A    Yes.   I  have  spoken  to  him  on  the  phone,  as  I  told 
you  in  past  meetings,  I  guess,  about  two  or  three  times. 


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507  C  Sticct.  N  E  25 

Waihm(toii.  D  C      20002 
(2021  M6-M6« 


WUSSIFIED 


364 


MR.  KAPLAN:   Let  the  record  reflect  that  IBC's 

offices  are  near  Dupont  Circle  as  are  General  Secord's 

t 
counsel's  offices. 

Off  the  record. 

[Brief  discussion  off  the  record.] 

MR.  KAPLAN:   Back  on  the  record. 

BY  MR.  KAPLAN: 
Q    In  what  context  did  you  have  phone  conversations 
with  Mr.  Secord  previously? 

A    Well,  I  didn't  know  it  was  Mr.  Secord  at  the  time 
during  the  al-Masoudi  business.   I  eventually  got  to  the 
point  — 

MR.  KAPLAN:   What  I  would  like  to  do  actually  is  to 
go  on  for  about  five  more  minutes  and  then  take  about  a  ten- 
minute  break. 

THE  WITNESS:   The  supposed  oil  contract  needed  to 
be  checked  out  and  I  asked  Colonel  North  if  there  wasn't 
somebody  that  couldn't  in  an  official  capacity  check  it  out. 
And  he  gave  me  a  number  in  Northern  Virginia  and  said,  "Call 
this  and  ask  for  Mr.  Kopp",  and  I  did,  and  they  took  my  name 
and  number  and  then  called  me  back,  ■?r  rather  he  called  me 
back.   I  gave  him  the  account  number  or  the  contract  number, 
and  he  called  me  back  in  about  a  week-and-a-half  or  two  weeks 
to  tell  me  that  the  contract  did  not  exist. 

BY  MR.  KAPLAN: 


IINCIASSIflEO 


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Wuhui{<Ofl.  D  C       20002 
(202)  146-««66 


iCUSSIFIED 


365 


Q    Do  you  recall  the  third  phone  conversation  you  had 
with  Mr.  Kopp? 

A  I  called  him  about  —  well,  no,  those  were  the  only 
ones  I  had  with  Mr.  Kopp.  I  had  one  other  phone  conversation 
with  him  about  a  month  ago. 

Q    What  gave  rise  to  that  conversation? 

A    I  had  a  film  idea  and  I  wanted  to  discuss  it  with 

him. 

Q    Why  did  you  discuss  General  Secord  to  discuss  the 

film  idea  with  him? 

A    Well,  I  figured  with  he  on  one  side  of  this  network 
and  me  on  the  other,  we  would  pretty  much  cover  the  details 
associated  with  it.  It  has  gone  nowhere  than  a  phone  conversa- 
tion. 

Q    Is  it  an  idea  that  relates  to  some  of  the  activities 
under  investigation  by  these  Committees? 
A    Of  course. 

MR.  KAPLAN:   I  am  going  to  ask  the  reporter  to  mark 
as  Exhibit  Number  25  a  copy  of  a  page  of  notes  that  was 
produced  by  your  counsel  to  us. 

(Where'jpon,  Deposition  Exhibit 
Number  2  5  was  marked  for 


identification. ) 
BY  MR.  KAPLAN: 
Q    Can  you  identify  those  notes? 


IIILASSIFIED 


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Waihiafna.  DC.    20002 
(102)M64C6« 


UNCUSSIRED 


366 


A    Yes .   That  is  from  a  notebook  that  I  kept  during 
the  al-Masoudi  period. 

Q    Okay.   Do  you  recall  the  context  in  which  these 
notes  were  written? 

A    It  was  a  conversation  with  Mr.  al-Masoudi. 

Q    Did  Mr.  al-Masoudi  tell  you  the  information  that  is 
contained  in  the  item  numbered  1,  which  says  "Paid  order  to 
Credit  Suisse",  and  then  it  has  the  name  Kopp  underneath? 

A    Yes. 

Q    Did  Mr.  al-Masoudi  know  this  Mr.  Kopp? 

A    He  met  him  in  Geneva. 

Q    And  was  this  a  request,  and  does  this  note  reflect 
a  request  from  al-Masoudi  for  you  to  send  some  money  to  him 
in  care  of  Credit  Suisse  and  Mr.  Kopp? 

A    No. 

Q    Do  you  recall  what  this  note  reflects? 

A    Barely.   It's  vintage  al-Masoudi.   It's  some  bright 
idea  he  had  to  give  Mr.  Kopp  some  money. 

Q    Did  he  tell  you  what  he  was  going  to  give  Mr.  Kopp 
some  money  for? 

A    No,  but  I  am  assuming  that  he  had  put  two  and  two 
together  and  assume  that  Mr.  Kopp  was  in  some  way  related  to 
Mr.  North  and  the  Nicaraguan  resistance. 

Q    When  did  you  learn  that  Mr.  Kopp  was  the  same 
person  as  General  Secord: 


"  tic 


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Wuhiafioa.  DC     20002 
(202)  M«-«66 


u 


ILASSIRED 


367 


A    I  think  it  was  the  same  article  as  the  H.  Ross 
Perot  revelation. 

Q    That's  in  December  of  1986. 

A    Yes,  but  it  was  about  that  period  anyway. 

Q    Were  you  aware  at  the  time  that  you  were  handling 
some  transactions  between  IC,  Inc.  and  Lake  Resources,  and 
that  Mr.  Kopp  had  an  association  with  Lake  Resources? 

A    Well,  I  think  from  the  al-Masoudi  business  I  had 
some  inkling,  but  nothing  substantial  or  specific. 

Q    Did  Mr.  Kopp's  name  ever  come  up  in  conversations 
between  you  and  Colonel  North  or  you  and  anyone  else  in 
connection  with  your  contra  funding  activities? 

A    Well,  subsequent  to  the  checking  out  of  the  oil 
contract,  Colonel  North  said  that  he  sent  somebody  to  see  the 
real  Ibrahim  al-Masoudi  in  Saudi  Arabia,  and  I  believe  he 
told  me  it  was  Mr.  Kopp. 

Q    Any  other  times  that  you  recall  his  name  being 
mentioned  in  connection  with  your  contra  funding  activities? 

A    I'm  not  remembering  any  right  now. 

Q    How  well  did  you  know  William  Casey? 

A    He  fired  me  one  time.   He  Furloughed  me,  as  you 
were  so  nice  to  put  it  before. 

Q    Aside  from  that,  how  closely  did  you  work  with  him 
during  the  campaign,  that  is  the  1980  campaign? 

A    In  1980,  not  very  closely. 


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Wiihiii(ioa.  O  C     20002 
(202)  Vt«4«M 


ONCLASSIHED 


368 


Q    Did  you  have  any  subsequent  dealings  with  Mr.  Casey? 
A    No,  not  directly. 

Q    What  dealings  would  you  have  had  with  him  possibly 
indirectly? 

MR.  DUDLEY:   I  object  to  the  form  of  the  question 
THE  WITNESS:   Well,  there  was  an  indirect  dealing 
and  that  was  that  Mr.  Fischer  set  up  a  meeting  between  Mr. 
Channell  and  Mr.  Casey  to  discuss  an  idea  that  Mr.  Channell 
had  for  doing  a  film  on  the  Central  Intelligence  Agency. 
BY  MR.  KAPLAN: 
Q    And  I  take  it  to  your  knowledge  nothing  ever 
materialized  about  that  film  idea? 

A    No.   I  shy  away  from  films  about  the  Central 
Intelligence  Agency. 

Q    You  described  yesterday  some  contacts  and  communica- 
tions you  had  with  a  fellow  named  Roy  Godson. 
A    Yes. 

Q    Are  there  any  other  contacts  you  had  with  Mr. 
Godaon  than  the  ones  that  you  described  yesterday? 

A    Not  that  I  had,  but  I  think  Frank  had  some  brief 
contact  with  him  at  about  the  time  they  produced  their  book 
on  Soviet  disinformation. 

Q    Have  you  ever  had  any  contact  with  Vice  President 
Bush? 

A    I  have  met  Vice  President  Bush 


ntact  With  Vice  President 

ICIASSIRED 


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MlCSocn.  NE  25 

Vukingna.  DC     20002 
(»])  1M6M6 


Q    Any  substantive  contact  with  him? 

A    Well,  Mr.  Conrad,  Mr.  Channel 1  and  myself  went  to 
see  Vice  President  Bush.   Mr.  Channell  requested  the  meeting. 
Mr.  Fischer,  Mr.  Artiano  and  myself  set  it  up.   I  went;  we 
were  presenting  to  Vice  President  Bush  a  survey  of  the  Select 
500  which  is  a  Channell  survey  system  of  senior  contributors 
to  try  and  get  some  sense  of  the  conservative  activist 
heartbeat,  senior  conservative  activist  heartbeat.   And  we 
went  and  presented  that  to  him,  and  also  described  the 
Central  American  Freedom  Program  and  suggested  that  he  might 
try  and  attend  one  of  the  briefings.   And  he  said  that  if  it 
fit  his  schedule,  he  would.   We  subsequently  tried  and  it 
didn't  fit  his  schedule,  so  he  didn't. 

Q    Who  arranged  the  meeting  for  you  with  Vice  President 
Bush? 

A    I  think  it  was  a  collective  effort  of  myself,  Mr. 
Fischer  and  Mr.  Artiano. 

Q    Have  you  ever  met  Donald  Gregg? 

A    No,  I  don't  think  so. 

Q    Have  you  ever  had  any  dealings  with  Felix  Rodriguez? 

A    No. 

Q    Did  you  have  any  knowledge  of  the  Iranian  arms ' 
sales  prior  to  public  disclosure  of  thpsfi-Sflies? 

A    No. 

Q    Did  you  have  any  knowledge  of  what  is  commonly 


disclosure  of  those  sa^s 

UNClASSiFlED 


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iHLLn  Rvomwo  CO,  MC 

MTCSotn.  NE  25 

Wuhiiifioa.  DC     20002 
(202)  M«-MM 


UNCUSSinED 


370 


referred  to  as  the  diversion  of  proceeds  from  those  arms' 
sales  to  the  contras  prior  to  public  disclosure  of  that 
activity? 

A    Unfortunately  no. 

Q    Did  you  have  any  knowledge  of  any  third-country 
solicitations  that  took  place  by  United  States  Government 
officials  prior  to  the  public  disclosure  of  those  solicita- 
tions and  aside  from  the  reference  to  third-country  solicita- 
tion to  which  you  testified  back  on  June  23rd? 

A    Of  June  2  3rd? 

Q    Do  you  recall  on  June  23rd  you  testified  that  in 
your  conversation  with  Colonel  North  on  Friday,  November 
21st,  he  made  a  reference  which  you  didn't  understand  at  the 
time,  that  he  had  given  one  to  Secretary  Shultz  and  Secretary 
Shultz  hadn't  done  so  well  on  it.   Do  you  recall  that 
testimony? 

A    I  do. 

Q    Aside  from  that  conversation,  did  you  in  1985  and 
1986  have  any  knowledge  of  any  third-country  solicitations  — 

A    No. 

Q    —  made  by  the  United  Stat'^s  Government  personnel? 

A    No. 

Q    Did  you  have  any  knowledge  of  any  third-country 
solicitations  on  behalf  of  the  contras  made  by  anyone  during 
1985  and 


'""  yilMSiREi 


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mtxm  mrcmma  co..  mc. 
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Wuhifliiaa.  0  C      20002 
(202)  )4<-MM 


UNCUSSIFIM 


371 


MR.  DUDLEY:   To  the  extent  that  the  al-Masoudi 
effort  could  be  considered  a  third  country  — 

MR.  KAPLAN:   Why  don't  we  take  a  break  here  for 
five  minutes. 

Off  the  record. ) 
[Brief  recess. ] 

MR.  KAPLAN:   Let  me  ask  the  reporter  to  mark  as 
Deposition  Exhibit  26  a  copy  of  what  purports  to  be  two 
telexes  from  you  and  Mr.  Gomez  to  an  Anthony  K.  Devine  in  the 
Cayman  Islands. 

(Whereupon,  Deposition  Exhibit 
Number  26  was  marked  for 
identification. ) 
BY  MR.  KAPLAN: 
Q     I'm  just  going  to  ask  you  if  you  could  briefly  tell 
us  for  the  record  what  gave  rise  to  the  two  telexes  that  are 
represented  by  Exhibit  26.  , 

A     I  went  to  see  Colonel  North  after  the  Hasenfus 
plane  was  shot  down,  and,  as  I  recall,  he  was  pretty  franti- 
cally working  around  the  office,  and  I  sat  at  the  conference 
table  for  some  time,  and  I  got  in  one  question,  which  was: 
Was  that  one  of  our  P^cftfft/IWpnknaka&aj^jJie  planes  that 


IfflE! 


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)07  C  Stfcn.  NE  25 

Viiltinpon.  D  C      20002 
(202)  V*6-M66 


uNcussra 


372 


NEPL  had  raised  money  for?  And  he  said,  "Sure  was",  or 
something  to  that  effect;  I  have  forgotten  exactly  what  it 
was  he  said,  but  his  answer  was  affirmative. 

And  he  was  talking  to  somebody  on  the  telephone, 
frantically  trying  to  find  a  way  to  find  an  American  citizen 
to  give  $10,000  to  the  United  States  Embassy  to  reimburse 
Consular  Affairs  to  bring  the  bodies  of  Mr.  Walker  and  the 
other  individual  back  to  the  United  States.   There  are 
usually  —  I  am  aware  of  this  because  of  my  work  at  AID  -- 
there  are  usually  mortuary  responsibilities  that  are  absorbed 
by  the  Consular  Affairs  Office  in  the  Embassy,  and  the 
individual  family  is  responsible  for  reimbursing  it. 

And  I  looked  at  him  and  I  said,  "Why  are  you  going 
through  all  of  this  pain  and  aggravation?   Why  don't  you  just 
give  me  the  account  number  and  I  will  transfer  the  money  from 
IC,  Inc.?"  And  he  thought  for  a  second  and  he  said  to  the 
person  that  he  was  talking  to  on  the  phone,  "I'll  call  you 
back."   And  it  just  hadn't  dawned  on  him  to  do  it.   So  he 
called  back  and  asked  who  the  money  should  be  sent  to. 

I  don't  know  who  he  was  talking  to  on  the  other 
line.   It  may  have  been  this  Mr.  Wal'cer.   And  this  is  the 
information  that  he  got.   I  went  back  and  sent  a  telex  that 
night  or  the  next  day,  and  he  then  called  me  on  the  phone  and 
said,  "Has  that  transaction  taken  place  yet?"   And  I  said,  "I 
have  sent  the  te^^piqi  l^^^d^)^  j^^^a^Xdl*  you  pull  it  back?" 


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iuulUi  raroKTiNa  co .  inc. 

507  C  Strett    N  E  2  5 

Wuhiniton.  D  C      2000Z 
(20!)  M&-6M« 


And  I  said,  "I  think  so."   And  he  said,  "Please  cancel  it." 

Q    Did  he  tell  you  why  he  wanted  you  to  cancel  the 
telex? 

A     No. 

Q    Did  you  ask  him  why? 

A    No. 

MR.  OLIVER:   Can  I  follow  up  just  on  that  particular 
thing? 

Mr.  Miller,  after  you  cancelled  that  telex,  did  you 
notify  Mr.  Walker  either  directly  or  indirectly  that  it  had 
been  cancelled? 

THE  WITNESS:   I  never  discussed  it  either  way  with 
Mr.  Walker.   I  never  talked  to  Mr.  Walker  about  it. 

MR.  OLIVER:   Did  you  discuss  with  anyone  else 
contacting  Mr.  Walker? 

THE  WITNESS:   I  don't  believe  so.   No,  I  didn't. 
MR.  OLIVER;   You  didn't  instruct  anyone  to  notify 
the  State  Department  or  Mr.  Walker  that  the  telex  had  been 
cancelled  or  that  other  arrangements  had  been  made? 
THE  WITNESS:   No. 
MR.  OLIVER:   Thank  you. 
BY  MR.  KAPLAN: 
Q    Did  the  initials  lOtfH  ^*fqr  .io^aji^  aircraft? 
A    I  believe  so. 
Q    Do  you  know  what  kind  of  aircraft  they  refer  tO' 


379 


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»7  C  Siiett.  N  E  25 

Wiihin(to<l.  O  C      20002 
(202)  Mi-666« 


WNCWSSIflEO 


374 


A    C-9,  I  really  don't  know  what  configuration  it  is. 

Q  Do  you  recall  a  conversation  with  Colonel  North  in 
the  summer  of  1986  in  which  you  would  have  informed  him  that 
a  C-9  was  on  standby? 

A    A  C-9  was  on  standby? 

Q    Yes. 

A    I  don't  think  so. 

Q    Would  he  have  given  you  any  information  to  that 
effect? 

A 

Q 

A 
matter 

Q 

A 

Q 

A 


When?  February? 

Summer  of  1986. 

It  may  have  been  in  regards  to  the  al-Masoudi 


No,  in  1986. 

Oh,  1986? 

Right . 

It  could  have  been  one  of  the  heavy-lifting 
operations  -   There  was  one  point  when  he  had  an  extremely 
urgent  need  for  money  and  nothing  was  moving  until  the  money 
got  there,  and  that  may  have  been  the  instance  in  which  -- 

MR.  KAPLAN:   Okay.   I  am  q-.^ing  to  ask  the  reporter 
to  mark  as  Exhibit  27  a  copy  of  a  document  that  was  produced 
to  us  by  your  counsel.   It  is  typewritten,  and  it  is  headed 
at  the  top  "Statutory  Provisions  on  Contra  Aid". 

(Whereupon,  Deposition  Exhibit 


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107  C  Sum.  N  E  25 

Vuhiopoo.  D  C      20002 
(U2|  M«-««66 


UNCLASSIHED 


375 


Number  27  was  marked  for 
identification. ) 
BY  MR.  KAPLAN: 

Q    Do  you  recognize  this  document? 

A    Yes. 

Q    Can  you  tell  us  what  the  document  is? 

A    I  got  this  document  since  Colonel  North  left  the 


NSC. 


Q    Do  you  know  who  prepared  it? 

A    I  don't. 

Q    Where  did  you  get  the  document  from? 

A    I  honestly  don't  remember.   I  may  have  gotten  it 
from  Frank  Gomez . 

Q    Did  you  ask  Gomez  for  the  document? 

A    No,  but  lots  of  times  when  he  had  something,  he 
just  provides  it  to  me  if  he  knoira  I'm  working  on  it. 

Q    And  for  what  purpose  did  you  receive  this  document, 
or  for  what  purpose  did  you  ask  for  this  document? 

Let  me  back  up  a  minute.   How  did  this  document 
come  into  your  possession? 

A    I  don't  remember  specifically  how  it  came  into  my 
possession.   My  use  of  it  was  general  information.   I  was 
trying  to  produce  a  time  line  for  Mr.  Channell's  ads,  and  I 
needed  across  the  bottom  legislative  landmarks  and  Administra- 
tion policy  landmarks,  and  ^|&>¥>A'%  tbaX.'^ vtldt-I_used  this 


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iO'CSotn.  NE.  2  5 

Wulunroa.  D  C     n)002 
(202)  iti-ttU 


UNCLASSIFIED 


376 


for.  I  produced  that  in  January,  I  think. 

Q    Okay . 

And  is  it  fair  to  characterize  the  document  as  a 
description  of  the  variety  of  statutory  provisions  dealing 
with  contra  aid  or  prohibitions  of  aid  to  the  contras  by  the 
United  States  Government? 

MR.  DUDLEY:   I  object  to  the  form  of  the  question. 
I  think  the  docximent  speaks  for  itself,  and  I'm  not  sure  he 
is  competent  to  answer  the  question  framed  in  those  terms. 
BY  MR.  KAPLAN: 

Q    What  did  you  consider?  What  kind  of  information 
did  you  consider  this  document  to  provide  you  with? 

A    Items  of  note  in  the  legislative  process  associated 
with  aid  to  the  Nicaraguan  resistance. 

Q    Did  you  have  any  knowledge  of  hostage  rescue 
efforts,  that  is  rescue  efforts  of  the  hostages  held  in 
Lebanon  prior  to  the  public  disclosure  of  some  of  those 
hostage  rescue  efforts  during  the  course  of  these  investiga- 
tions? 

A    Yes. 

Q    First,  I  am  going  to  ask  y^ru  whether  you  were  ever 
asked  to  provide  any  money  to  extricate  the  hostages  that 
were  held  in  Lebanon? 

A    I  was  asked  to  provide  money  that  was  used  in  an 
effort  to  extricate  hostages  from  Lebanon. 


ilNP  mm 


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iMuoi  mroitma  co..  hc. 

)07  C  Street.  NE  25 

Wuhuitnin.  D  C     20002 
(202)  HA^tU 


mUSSIFIED 


377 


Q    why  don't  you  tell  us  first  what  knowledge  you  had 
of  any  hostage  rescue  efforts  prior  to  their  public  disclosure 
late  last  year? 

A    In  the  summer  of  1985  when  I  began  working  with 
Ibrahim  al-Masoudi  on  this  oil  contract  that  was  to  provide 
assistance  to  the  Nicaraguan  resistance,  I  flew  to  Fresno, 
California  for  meetings  with  Mr.  al-Masoudi.   And  while  I  was 
there  the  TWA  hostage  crisis  unfolded  in  Lebanon,  and  Mr.  al- 
Masoudi  immediately  offered  to  assist  in  securing  the  release 
of  those  hostages.   He  gave  me  a  fair  amount  of  information 
which  I  passed  on  to  Colonel  North  by  telephone.   Colonel 
North  indicated  that  the  information  seemed  a  track.   "Track" 
is  a  word  of  art;  it  seems  to  be  associated  with  activities 
that  Colonel  North  conducts . 

And  as  the  crisis  unfolded,  al-Masoudi  began  to 
broaden  his  offer  to  help  at  that  point  five  hostages  held  in 
Beirut  by  terrorists.   And  all  the  information  I  got  from  al- 
Masoudi  —  whether  it  was  names,  places  or  numbers  or 
whatever  —  I  tried  to  pass  those  on  as  often  as  possible 
daily  to  Colonel  North,  and  in  one  instance  to  the  Task  Force 
that  was  set  up  at  the  Federal  Bureau  of  Investigation  for 
the  TWA  crisis. 

Q    How  did  you  know  about  the  Task  Force  that  had  been 
set  up  at  the  FBI? 

A    There  was  aiai^fSkef  if oJeyant  information  that  al- 


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■uoi  nvomara  co..  mc 
»7  C  Sireit.  N  E  25 

Wukinfion.  0  C      20002 
(202) 


IINCUSSIflED 


378 


Masoudi  had,  and  they  wanted  to  discuss  it  with  him.   And  I 
don't  know  whether  North  --  I  don't  know  who  told  who  to  do 
what,  but  I  was  told  to  call  the  Task  Force,  and  they  set  up 
a  meeting  with  al-Masoudi  in  Houston,  I  believe. 

Q    Do  you  recall  who  you  spoke  to  at  that  FBI  Task 
Force? 

A    I  don't  remember  the  agent's  name,  but  they 
certainly  would  have  records  of  it.   They  sent  field  agents 
to  interview  al-Masoudi  in  Houston. 

Q    Did  you  attend  those  interviews? 

A    No. 

Then  when  we  went  to  —  when  al-Masoudi  and  I  went 
to  London  and^^^^^^^B  al-Masoudi  had  made  an  offer  while 
we  were  ^^^^^^^B^°  ^^  ^^^   help  in  some  form  of  a  rescue 
effort  that  the  DBA  agents  were  involved  in,  and  it  required 
on  one  occasion  $15,000  and  on  another  I  think  $5,000  or 
$10,000.  And  I  transferred  that  money  initially,  the  $18,000 
in  travelers  check  sent  by  DHL  Courier,  and  subsequently  the 
other  monies,  I  think,  were  transferred  via  the  American 
Express  offices  in  Geneva. 

Q    What  DBA  agents  are  you  referring  to?  Can  you  tell 
us  their  names?  ^^^^ 

A    Well,  the  only  one  I  remember  is^^^^^^^^^Hwho 
flew  with  us  to  London,  and  then  flew  onto] 

Q    When  you  sent  travelers  checks  to  support  the 

MMPI  ACCIPCn 


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)07  C  StiCTT.  N  E  25 

WuhingToa.  D  C      20002 
(202)  ^tt-ittt 


UNCLASSIFIED 


J79 


operation,  who  requested  the  money? 

A    Al-Masoudi  requested  it.   I  discussed  it  with  North 
and  he  approved  me  of  sending  it. 

Q    What  were  the  source  of  funds  for  those  traveJ*^^ 
checks? 

A    That  was  money  that  had  been  provided  by  NEPL 

Q    Was  Mr.  Channel 1  or  Mr.  Conrad  ever  told  that  *°™® 
of  the  money  that  they  provided  was  used  for  hostage  res'-"® 
efforts? 

A    No. 

Q    You  referred,  I  believe,  to  approximately  $18 ^''^O 
worth  of  travelers  checks  that  were  sent  by  DHL  Courier  ^H 
|.   Were  those  sent  toward  the  end  of  August  of  19"^' 

A    I  think  that's  correct. 

Q    Was  there  a  later  traveler  check  transfer  alac*  ^V 
DHL  Courier  to  al-Masoudi  of  $5,000? 

A    Yes. 

Q    Would  that  have  occurred  early  in  November  19C^- 
Or  did  that  occur  early  in  1985? 

A    There  was  a  transfer,  I  think,  in  November  th*^ 
wasn't  completed.   He  never  picked  them  up  because  he  w**  ^" 


jail. 


yNMSinEi 


Q    November  1985? 

A     I  have  forgotten  exactly  when  that  pick-up  wa^'  ''^'- 
we  got  back  $4,500  of  that  because  he  had  been  arrested*  ^"" 


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507  C  Sirett.  Hi.  2  5 

Wuhmiiofi.  0  C.    20002 
(202)  Mt-MM 


ni^mim 


380 


it  was  at  the  time  of  the  Summit.   So  I  think  the  Summit  was 
in  November. 

Q    Do  you  recall  having  filed  a  Treasury  report  form 
nonetheless  for  that  transfer? 

A    Yes. 

Q    Was  there  also  a  transfer  about  five  or  six  days 
later  of  $9,000  of  travelers  checks  by  DHL  Courier  to  al- 
Masoudi? 

A    I  don't  remember  through  DHL. 

Q    Okay . 

Does  it  refresh  your  recollection  if  I  told  you 
that  we  have  from  the  Department  of  Treasury  the  various  CMIR 
filings  that  you  made?  That's  currency  and  monetary  instru- 
ments reports'  filings  to  what  you  have  testified  earlier. 
And  they  show  $18,500  on  August  30th  by  DHL  Courier  to  al- 
Masoudi,  35,000  again  travelers  checks  on  November  1  by  DHL 
Courier  to  al-Masoudi,  and  $9,000  again  travelers  checks  by 
DHL  Courier  to  al-Masoudi  on  November  6,  1985? 

A    Yes. 

MR.  DUDLEY:   Do  you  understand  his  question? 
People  are  frequently  confused  refre'shing  recollections.   The 
fact  that  he  has  got  a  |i:Hl(|]A|th||t^pmp|r^t^fe^doesn't  mean 
that  you  remember  it. 

His  question  to  you  is:   His  having  told  you  about 
the  record,  do  you  now  remember  it? 


tUMSSIFIED' 


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507  C  Suc«.  N  E  25 

VuhmiTon.  O  C      Z0002 
(202)  V«6-6M6 


UNCLASSIFIED 


381 


THE  WITNESS:   I  remember  that  we  filed  three  forms. 
BY  MR.  KAPLAN: 

Q    Were  those  checks  all  sent  at  al-Masoudi's  request? 

A     Yes. 

Q    Was  each  transfer  of  travelers  checks  to  which  you 
have  just   testified  approved  by  North? 

A     Yes. 

Q    I  am  going  to  take  you  back  to  your  initial 
dealings  with  al-Masoudi.   What  did  he  propose  to  you  in 
terms  of  the  business  venture? 

MR.  DUDLEY:  As  a  starting  question,  I  am  not 
wildly  enthusiastic  about  that  one.   My  problem  with  it  is 
that  I  am  not  sure  that  the  first  proposal  is  accurately 
characterized  as  a  business  venture.   There  are  later 
proposals  I  think  that  are  more  accurately  characterized  that 
way. 

MR.  KAPLAN:   I  will  withdraw  that  question. 
BY  MR.  KAPLAN: 

Q    I  believe  that  you  testified  earlier  that  your 
first  meeting  with  al-Masoudi  occurred  some  time  in  April  of 
1985,  and  that  he  had  been  referred  "--o  you  by  Colonel  North. 

A    Actually,  I  think  I  testified  that  it  was  early  in 
April  or  late  in  March  of  1985. 

Q    Okay. 

A    We  had  two  meetings  with  him,  the  second  where  he 


JNCUSSinED 


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24 
Hujn  nromma  co.,  inc. 

507  C  Sum.  N  E  25 

WuhtnftoA.  DC     20002 
(202)  »i-Uti 


NCUSSIFIED 


382 


signed  this  letter. 

Q    Did  you  meet  with  al-Masoudi  shortly  after  he  had 
been  referred  to  you  by  North? 


A 
Q 
meeting? 

A 


I  think  it  was  the  same  day. 

Okay.   Did  someone  accompany  al-Masoudi  to  that 


Kevin  Katke. 

Q    How  would  you  describe  Kevin  Katke? 

A    You  mean,  what  was  his  role  in  the  meeting? 

Q    Who  is  Kevin  Katke? 

A    Kevin  Katke  to  my  understanding  at  that  moment  was 
a  business  agent  of  al-Masoudi. 

Q    Have  you  come  to  any  other  understanding  as  to  what 
Kevin  Katke  does? 

A    Well,  I  was  told  by  Colonel  North  that  he  had 
attempted  to  enter  in  the  Central  Intelligence  Agency  and  had 
been  rejected,  that  he  was  unreliable  because  he  tended  to 
talk  about  people  whom  he  had  no  real  connection  with  or  no 
right  to  claim  a  connection  with,  and  sort  of  an  Intelligence 
community  gap  line. 

Q    During  your  initial  meetings  with  al-Masoudi,  did 
he  tell  you  what  his  interest  was  in  meeting  with  you? 


Al-Masoudi 's? 


UNCLASSIFIED 


Did  al-Masoudi  tell  me  what  al-Masoudi 's  interest 


388 


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Hixn  RCroimHa  co..  inc. 

507CSUCTI.  NE  25 

Wuhiniton.  O  C     20002 
(202)  Mi-MM 


383 


was? 


Yes. 


UNCUSSIFIED 


A     Yes. 

Q    What  was  that  interest? 

A    Well,  it  was  a  little  difficult  to  understand  at 
first  because  al-Masoudi  was  speaking  pigeon  English  and 
Katke  who  doesn't  speak  Arabic  or  whatever,  Farsi,  was 
translating.   So  it  was  a  very  unusual  circumstance  and  it 
made  it  a  very  difficult  meeting.   It  probably  lasted  an  hour 
and  it  could  have  lasted  five  minutes.   But  basically,  al- 
Masoudi  held  himself  out  as  the  Prince  of  Jedda,  Ibrahim  al- 
Masoudi,  Senior  Saudi  prince,  and  he  had  a  royal  family 
allotment  oil  contract,  of  which  he  wanted  to  donate  $14 
million  in  the  proceeds  to  the  Nicaraguan  resistance.   And  he 
asked  if  we  could  assist  him  in  doing  that,  and  we  said  yes. 

Q    What  did  you  understand  the  form  of  your  assistance 
to  be? 

A    I  didn't  really  know  at  that  point. 

Q  And  what  did  you  come  to  understand  that  the  form 
of  your  assistance  would  be? 

A  Well,  I  discussed  it  subss'juently  with  North,  and 
we  decided  to  have  me  meet  him  the  second  time,  and  to  have 
him  make  whatever  the  formal  offer  was,  and  the  second  time 
he  came  to  see  me,  I  suggested  to  him  that  he  not  bring  Mr. 


Katke,  and  he  agreed. 


UNCUSSIFIED 


389 


UNCLASSIFIED 


384 


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■uu  Rtrwrrma  CO..  mc. 
507  C  Soctt.  N  E  25 

Vaifcispoo.  O  C     20002 
(202)  Vt«-««M 


And  this  time  he  brought  with  him  a  gentleman  whom 
he  introduced  as  his  attorney.   The  gentleman  gave  me  a 
business  card  that  indicated  that  he  was  President  and 
Chairman  of  the  Board  of  the  William  Penn  Bank  in  Philadel- 
phia. And  Katke  had  told  me  in  a  telephone  conversation  that 
Mr.  al-Masoudi  was  attempting  to  buy  an  interest  in  this 
bank.  So  that  was  pretty  good  bona  fides  to  show  up  with  the 
Chairman  of  a  bank  in  Philadelphia. 

Q    Did  al-Masoudi  propose  a  business  relationship  at 
that  second  meeting? 

A    He  proposed  a  contract  letter  which  he  dictated  in 
Arabic  to  my  secretary  who  spoke  Arabic,  and  she  translated 
it  into  English,  and  it  called  for  a  total  of  $15  million  to 
be  paid  to  IC,  Inc.   And  again  the  name  IC,  Inc.  was  chosen 
at  the  conference  table  at  that  moment. 

I  hadn't  been  to  the  Caymans;  I  hadn't  selected  a 
name.   And  the  increase  of  $1  million  was  subsequent  to  a 
conversation  with  North  where  I  indicated  that  Frank  and  I 
were  willing  to  undertake  this,  but  we  weren't  about  to  risk 
life,  limb  and  professional  reputations  without  some  compensa- 
tion for  it,  and  we  were  going  to  require  that  this  individual 
pay  an  additional  $1  million. 

And  he  agreed  to  that.  So  the  subsequent  contract 
from  al-Masoudi  to  us  said  enough  liftings  in  order  to  equal 
$15  million.   It  was  a  fairly 


mmmB 


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MLUM  ntromma  co..  inc. 

507  C  StTCCT.  N  E  25 

Wuhinfion.  DC.     20002 
(U2I  )4&-666« 


UNCLASSIFIED 


385 


Q  Was  the  understanding  that  $14  million  would  go  to 
the  Nicaraguan  resistance  and  $1  million  would  go  to  you  and 
Mr.  Gomez? 

A    That's  correct. 

Q    What  was  your  understanding  at  that  time  or  shortly 
thereafter  as  to  the  nature  of  services  that  you  would  be 
called  on  to  perform? 

A    I  can't  put  a  specific  finger  on  them,  but  al- 
Masoudi  was  a  very  demanding  individual.  He  called  every  15 
minutes  with  a  new  problem.   He  required  us  to  carry  the  bair 
in  meetings  with  people  who  spoke  English  and  to  handle  the 
financial  transactions. 

Q    If  you  can,  explain  briefly  what  the  nature  of 
these  transactions  was  intended  to  be.   You  mentioned  an  oil 
contract  worth  $14  million,  and  I  am  not  — 

A    Well,  the  contract  was  — 

Q  I  was  going  to  say  that  I  am  not  familiar  with  the 
way  oil  gets  sold  from  Saudi  Arabia. 

A    I  have  to  tell  you,  counsel,  neither  am  I. 

Q    Okay . 

A    After  all  of  this,  I  still  have  no  idea  how  it  is 

really  done. 

Q    What  I  am  curious  about  is  how  was  this  $14  million 
going  to  be  generated? 

A    Well,  apparently  —  and  this  was  the  reason  for  the 


391 


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MJJM  HtMNTIIM  CO..  MC 
)07CStr«t.  NE  25 

Vuhmfton.  D  C     20002 
(202)  )4<-«M6 


386 


Chairman  of  this  William  Penn  Bank,  unbeknownst  to  us  prior 
to  this  meeting  —  they  were  going  to  be  responsible  for  the 
financing  of  this  contract.   And  according  to  al-Masoudi,  the 
financial  end  of  the  transaction  is  the  one  that  pays  out  the 
commissions  or  associated  fees. 

The  actual  money  that  he  was  supposed  to  get  from 
it  was  quite  a  bit  more  than  $15  million,  a  certain  amount  of 
money  —  I  don't  know,  $60  or  $70  million. 

Q    Was  the  expectation  that  you  would  market  this 
contract? 

A    No,  not  initially.   What  happened  was  that  subse- 
quent to  that  meeting,  he  then  called  and  told  me  that  Mr. 
Katke  had  been  in  charge  of  marketing  and  failed.   And  he  had 
asked  if  we  could  assist  him  in  marketing  the  oil  contract. 
I  didn't  have  anybody  else  to  turn  to.   So  I  agreed  that  we 
would  try  and  do  that,  and  I  contacted  my  stockbroker  and 
asked  him  how  it  was  done.   He  suggested  that  his  firm  wasn't 
involved  in  that  type  of  transaction,  and  suggested  another 
brokerage  firm,  Merrill  Lynch. 

I  got  in  touch  with  the  Merrill  Lynch  commodities' 
brokers.   They  told  me  how  an  offer  to  sell  is  written  up.   I 
produced  it  for  them.   They  then  put  me  in  touch  with  a 
couple  of  brokers  who  then  asked  the  appropriate  question, 
which  was  what  is  the  contract  number,  something  al-Masoudi 
was  unwilling  to  give  them  for  a  whole  host  of  reasons,  which 


UNCLASSIRED 


392 


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MUin  mrowmm  co..  mc. 
W7  C  Strett.  N  E  25 

Vuhinftoa.  DC      20002 
(102)  Hi-MM 


UmssiFIED 


387 


he  claimed  all  to  be  legitimate.   I  had  no  way  of  knowing 
whether  they  were  or  weren't. 

And  he  then  subsequently  called  and  told  me  that 
the  time  had  expired  on  his  oil  contract  and  that  the  deal 
was  off.   And  I  then  in  a  very  short  period  of  time  later  got 
another  phone  call  from  him,  and  he  told  me  that  he  had 
gotten  a  new  oil  contract  and,  to  prevent  the  problems  that 
had  actually  gone  on  before,  he  had  actually  got  it  in  the 
name  of  International  Business  Communications. 

I  wasn't  any  further  along  in  my  understanding  of 
how  to  do  oil  contracts,  but  in  the  interest  of  helping  the 
resistance,  we  accepted  the  fact  that  it  was  in  our  ncune. 
And  I  flew  out  to  Fresno  to  meet  with  him  to  try  and  get  some 
more  information  on  it.   And  while  I  was  in  Fresno,  I 
participated  with  him  in  several  phone  calls  and  he  sent 
repeated  telexes  and  offers  to  sell  to  different  refineries 
and  so  forth  and  so  on.   And  I  was  an  observer  during  most  of 
that  period. 

Q    Just  so  we  can  clarify  for  the  record.   When  you 
talk  about  marketing  an  oil  contract^  is  that  the  same  thing 
as  selling  oil  to  someone? 

A    Precisely. 


ment?   Precisely? 

THE  WITNES 


MR.  DUDLEY:   Are  you  sure  you  can  make  that  state- 
:   You  said  when  ''^i  talk  about." 


393 


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OKLVt  mponrwo  CO .  inc. 
)07  C  Suen.  N  E  25 

Vuhioiton.  D  C     20002 
(202)  M6-6M« 


388 


MR.  DUDLEY:   Oh,  okay. 
[Laughter. ] 

MR.  KAPLAN:   I  was  just  asking  for  Mr.  Miller's 
understanding. 

THE  WITNESS:   It  was  a  wonderful  day,  sitting  in 
front  of  FBI  agents,  trying  to  explain  to  them  that  I  had  no 
idea  whether  anything  that  was  said  to  me  before  is  truth  or 
fiction. 

BY  MR.  KAPLAN: 

Q    Was  the  idea  that  the  prince  could  deliver  on  some 
oil,  and  that  you  and  he  were  going  to  attempt  to  find 
purchasers  of  that  oil,  and  that  some  of  the  proceeds  from 
the  sale  of  that  oil  would  be  given  to  the  resistance,  to 
support  the  resistance,  and  $1  million  of  the  proceeds  from 
the  sale  of  that  oil  would  be  paid  to  IBC? 

A    I'll  accept  the  entire  litany  except  for  the  first 
item.   It  was  his  oil  contract,  supposedly  under  Saudi  Arabian 
law  it  belonged  to  him,  it  was  his  oil,  and  so  what  was 
represented  was  the  profit  was  about  60  to  $70  million  to  him. 

Q    The  profit  of  60  to  $70  million  was  to  him.   He 
could  deliver  on  the  product,  that  i3,  the  oil,  at  least  that 
was  his  representation? 

A    Correct. 

Q  $14  million  of   the  profit  was   going  to  go  to  the 

contras    through   IC,    Inc.?        •fi'fiii 


394 


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UtJUUI  MMNrnHO  CO..  MC. 
>07  C  Scieei.  N  E  25 

Wuhmron    O  C     20002 
(202)  V4«.M6« 


Correct. 


ICLASSIFIED 


389 


Q    And  $1  million  of  the  profit  was  going  to  go  to  IBC? 

A    Correct. 

Q    Okay.   Would  it  refresh  your  recollection  as  to 
your  initial  meeting  in  Fresno,  if  I  told  you  that  the 
Committee  has  documents  indicating  telephone  calls  from  you 
to  Colonel  North,  from  a  number  with  the  area  code  809,  which 
I  believe  is  Fresno's  area  code,  in  early  May  of  1985? 

A    That's  probably  my  first  meeting. 
MR.  DUDLEY:   First  trip  to  Fresno? 
THE  WITNESS:   First  trip  to  Fresno,  right. 
BY  MR.  KAPLAN: 

Q    Was  al-Masoudi  referred  to  by  any  code  name  between 
you  and  North? 

A    I  called  al-Masoudi  "Jewel."   He  wore  a  ring  that 
had  17  dieunonds  on  it,  seventeen  one-carat  diamonds,  so  I 
called  him  Jewel. 

Q    Did  North  refer  to  al-Masoudi  as  Jewel,  at  least  in 
conversations  with  you? 

A    With  me,  yes. 

Q    Did  you  keep  North  regularly  apprised  of  your 
dealings  with  al-Masoudi?  ^^ 

A    You  bet. 

Q    You  kept  him  apprised  of  your  dealings  with  al 
Masoudi,  both  with  respect  to  this  marketing  of  the  oil 


audi?        ^  .«.  .  .u.a  ^  H^ 

mmm 


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uixa  MrotrnNQ  co..  mc. 
)07  C  Sire«.  N  E  25 

VuhinfToa.  D  C     10001 
{Ml)  Mt-MM 


UNCLASSIFIED 


390 


contract  and  with  respect  to  al-Masoudi's  information  about 
the  location  and  possible  release  of  the  hostages  held  in 
Lebanon? 

A    That,  and  in  addition  to  that,  a  gold  contract 
which  he  began  to  try  and  supplement  his  failure  to  deliver 
on  the  oil  contract,  and  also,  his  description  of  himself  and 
other  individuals  associated  with  the  Saudi  Arabian  nation, 
and  I  hoped  that  it  could  be  checked  out  by  somebody  who  knew 
what  they  were  talking  about. 

Q    You  travelled  to  England  in  the  summer  of  1985  with. 
al-Masoudi  and  with  a  DEA  agent? 
A    That's  correct. 

Q    Did  you  go  on,  in  that  trip,  from  England^^HB 
ith  al-Masoudi? 
Yes. 

What  was  the  purpose  of  that  trip? 

To  finalize  the  oil  contract,  and  the  gold  contract, 
when  did  you  begin  to  suspect  al-Masoudi's 


A 

Q 

A 

Q 
bonaf ides? 

A    Well,  I  spent  a  whole  weekend  in  the  library, 
shortly  after  I  met  him,  at  the  McKelden  Library,  at  Univer- 
sity of  Maryland  looking  the  guy  up.   The  biggest  problem  you 
have  with  the  Saudi  royal  family  is  that  there  are  no  books 
with  pictures  of  any  of  them.   They  kind  of  like  it  that  way, 
apparently. 


WMSSIFIfD 


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■U.EII  ncpoKTiNa  CO..  mc. 

)07  C  Surei.  N  E  2  5 

Vuhin(io<i.  D  C      20O02 
(202)  !46-M«6 


UNCUSSIFIED 


391 


But  I  found  him.   In  fact  he  was  an  imposter.   He 
is  a  fraud,  but  he  is  an  imposter,  and  he  had  studied  his 
character  fairly  well.   And  everything  that  he  had  told  us 
about  himself  was  borne  out  in  written  form  in  the  literature 
that  I  found.   I  took  pictures  of  him  with  he  and  my  wife, 
and  then  gave  the  pictures  to  North  so  that  he  wouldn't 
suspect  that  I  was  giving  them  to  somebody  to  have  him 
checked  out.   And  we  tried  to — I  tried  to  go  home  at  night 
and  take  my  notes,  and  compile  summaries  that  could  then  be 
given  to  North  so  that  he  could  check  them  out. 

Q    To  your  knowledge,  were  any  other  people  at  the  NSC 
knowledgeable  of  your  dealings  with  al-Masoudi?  Of  any  of 
your  dealings  with  al-Masoudi? 

A    It's  possible  Fawn  may  have  heard  the  neune  in  pass- 
ing. 

Q    Do  you  recall  any  involvement  of  Howard  Teicher  with 
respect  to  al-Masoudi? 

A    Yeah,  Teicher '3  name  came  out  in  the  very  first 
conversation  with  al-Masoudi  and  Katke,  and  the  assertion 
from  Katke  was  that  al-Masoudi  had  provided  the  information 
that  helped  the  Kuwaitis  avoid  the  bombing  attack  on  Amir. 
Anyway,  he  continually  used  Teicher 's  name. 

And  when  I  raised  it  to  North,  he  told  me  that  in 
fact  this  individual  had  been  very  helpful  to  Teicher,  but  he 


didn't  elaborate  on  it.   And  when  I  would  provide  him  what  was 


ifoi  nooin 


397 


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mxm  BOonTiwo  co. 

MC. 

507  C  Scren.  N  E 

25 

WaihiD|ioa.  DC.    20C02 

CLASSiHED 


392 


intelligence  details  provided  by  al-Masoudi,  he  often 
remarked  that  that  tracked,  and  that  seemed  to  indicate  that 
al-Masoudi  was  ahead  of  the  news  cycle,  and  therefore  would 
have  not  known  those  things  if  he  hadn't  been  in  some  way  an 
active  participant  or  had  contacted  people  who  were  active 
participants . 

Q    Do  you  recall  some  time  in  June  of  1985,  when 
Teicher  lent  some  assistance  in  obtaining  a  visa  for  al- 
Masoudi  's  brother? 

A    Well,  al-Masoudi  asserted  that  Teicher  did  that.   I 
never  bothered  to  check  out  whether  or  not  he  did. 

Q    Did  you  have  any  conversations  with  Teicher, 
directly,  about  al-Masoudi? 

A    I  don't  believe  so. 


398 


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assife 


393 


And  the  only  official  response  I  ever  got  read  back  to  me  was 
that  he  had  had  one  meeting  at  the  Central  Intelligence 
Agency,  and  their  analysis  was  he  was  probably  who  he  said  he 
was,  that  he  was  a  distaff  prince  who  was  a  significant 
threat  to  the  Saudi  regime.   But  he  was  probably  who  he  said 
he  was . 

BY  MR.  KAPLAN: 
Q    I  want  to  go  back  to  the  trip  that  we  just  covered 
briefly  before,  in  which  you  and  al-Masoudi  and  a  DEA  agent, 
I  believe  named^^^^^^^^B  travel  led  to  England  and  then  on 

to  ^^mi^m^^i^^^^B 

Did  North  arrange  for^^BHto  accompany  you? 

A    Yes. 

Q    Did  you  ask  North  to  arrange  to  have  a  Federal 
agent  accompany  you?  Or  did  North  volunteer^^^^Hto  take 
this  trip? 

A    I  think  he  volunteered^^^^^nd  I  think  it  had 
more  to  do  with  al-Masoudi 's  hostage  business  than  anything 
else. 

Q    Did  you  know  who^^^^|.was  at  that  time? 

A    I  met ^^^^9 s'^d  somebody  named^^^^^-and  I  can ' t 
remember  the  guy's  last  name — and — 

Q    Was  it 

A    Yes.   In  North's  office 

Q    When  did  you  meet  them? 


UNCLASSIFIED 


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■am  Rvooraia  eo..  nc 
M7  C  Sort.  N  t  25 

Variua(tofi.  O  C      2000] 
(Kl)  itittti 


■imim 


394 


/ 


A    It  was  prior  to  the  trip.   I  don't  know  how  much 
prior  to  the  trip.   But  I  was  asked  to  recount  for  them  what 
al-Masoudi"had  told  me  about  the  hostages. 

Q    Did  you  know  at  that  time,  or  were  you  told  at  that 
time  that^^^^|and^^^H^|were  OEA  agents? 

A    I  think  I  knew  at  that  tine.   I  don't  know  whether 
I  knew  right  then  and  there,  but  by  the  time  he  got  on  the 
plane  in  Atlanta,  I  knew  he  was  a  OEA  agent. 

Q    Did  you  have  an  understanding  as  to  the  purpose  of 
.accompanying  you  on  the  travel  to  England  and  then^H 


A    I  had  a  very  good  understanding  he  was  there  as  a 
passive  observer. 

Q    A  passive  observer  of  what? 

A    Of  al-Masoudi. 

Q    What  was  supposed  to  be  the  product  of  his  observa- 
tion? 

A    I  don't  think  much  in  London,  but  I  think 
he  was  supposed  to  keep  kind  of  good  tabs  on  him. 

Q    Who  reguested^^^^Hto  keep  good  tabs  on  al-Masoudi? 

A    I  guess  North. 

Q    what  was  the  purpose  of — if  you  know--of  whyj 
was  keeping  tabs  on  al-Masoudi? 

A    Well,  I  think  at  that  point  they  were  treating  his 
offer  on  assistance  on  theS  Ji^ait;}i^s|(f|l|.f)}pf^<|y  ly. 


iiresinEir 


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HLLU  mromma  co..  mc 

lOTCSum,  NE  25 

Vaihui|ii».  0  C     20002 
(202)  )46-MM 


It 


CLASSIRED 


395 


Q    When  did  you  first  become  aware  that  al-Masoudi  was 
under  investigation  by  the  FBI  in  connection  with  a  check 
that  he  had  bounced  at  the  William  Penn  Bank? 

A    Well,  if  I  can  dissect  your  word,  investigation. 

Q     Yes. 

A    What  had  happened  was,  the  bank  had  undergone  its 
annual  FDIC  and  state  auditor  review  in  19 — it  was  fairly 
early  on.   I  think  it  was  like  May-June.   And  of  course  this 
bad  check  was  on  their  books,  and  so  the  FBI  is  the  inves- 
tigatory arm  of  these  FDIC  investigations.   And  they  wanted 
to  know  about  the  check. 

My  first  contact  with  an  FBI  agent  was  when  I  went 
to  Philadelphia  to  meet  with  the  board  of  directors.   They 
had  the  FBI  agent  there  in  their  offices  already,  and  he  was 
undergoing  a  process  of  investigation  at  that  time. 

I  thought  that  matter  was  somewhat  handled  and 
resolved  until  it  became  clear  that  al-Masoudi  was  not  who  he 
said  he  was,  and  therefore,  the  check  became  more  likely  to 
be  fraud,  but  the  next  real  contact  on  that  subject  was  when 
FBI  agents  contacted  Colonel  North,  myself,  and  then  subse- 
quently my  brother  and  his  best  frieid,  and  my  best  friend. 

Q    Well,  why,  if  you  know,  did  the  FBI  agents  contact 
your  brother  and  your  mutual  best  friend? 

A    We  had  all — I  had  borrowed  money  from  my  brother 
and  his  best  friend,  and  from  my  best  friend,  in  order  to  meet 


mnmi 


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iMxcn  MooarTMa  CO..  mc 
507  C  5tre«.  N  E  25 

Wuhmpoo.  D  C     20002 
(202)  M«.««6« 


UNCLASSIFIED 


396 


what  al-Masoudi  had  described  as  a  registration  fee  for  the 
oil  contract. 

Q    Is  your  brother's  name  Donald  Miller? 

A    That's  correct. 

Q  Do  you  recall  that  Colonel  North  was  first  inter- 
viewed by  FBI  agents  about  al-Masoudi  some  time  in  mid-July 
of  1985? 

A    He  was  contacted  initially,  I  think,  and  then 
subsequently  interviewed,  but  I  think  there  was  a  lag  period 
between  the  two  of  them,  and  it  took  me  a  long  time  to  get 
the  FBI  agent  to  call  me  back. 

Q    Was  he  interviewed  at  a  time  when  you  were  overseas' 

A    Must  have  been  because  I  saw  the  agent  shortly 
after  I  came  back. 

Q    Did  the  agent  try  to  contact  you  when  you  were 
overseas? 

A    I  don't  recall. 

Q  Do  you  recall  IBC's  having  received  messages  for 
you  from  the  agent  while  you  were  overseas? 

A    I  don't  specifically  recall.   It's  possible. 

Q  Did  you  ever  ask  Colonel  H?rth  to  respond  to  FBI 
calls  to  you,  in  an  effort  for  them  to  set  up  an  interview 
with  you? 

A     I'm  sorry.   Could  you  say  that  again. 

Q    Did  you  ever  ask  Colonel  North  to  call  an  FBI  agent 


iffort  for  them  to  set  up 

IIIUSSIFIED 


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liU.111  KVOOniM  CO..  MC. 
lOr  C  Suect.  N  E  25 

Wuhin(too.  DC      20002 
(202)  14«-M6t 


who  was  having  difficulty  getting  in  touch  with  you? 

A    No.   It  was  the  other  way  around.   I  asked  Colonel 
North  to  get  in  touch  with  the  FBI  agent  and  ask  him  to  get  in 
touch  with  me  because  the  guy  wasn't  returning  my  phone  calls. 

Q    Do  you  recall  the  name  of  the  FBI  agent? 

A    Kumars ik. 

Q    At  the  time  that  Kumars ik  first  interviewed  you,  to 
the  best  of  your  recollection  what  was  your  state  of  mind  as 
to  the  bonafides  of  al-Masoudi? 

A    At  that  point  it  was  a  50/50  proposition.   I  had  the 
FBI  telling  me  that  he  may  well  be  a  fraud.   They  weren't 
saying — Kumars ik  did  not  say  in  the  meeting  that  he  was  a 
fraud.   He  simply  asked  the  questions  that  led  me  to  believe 
that  he  felt  he  was. 

And  on  the  other  hand,  we  had  the  Central  Intel- 
ligence Agency  saying  he  probably  was  who  he  said  he  was. 
And  everything  that  seemed  to  indicate,  in  my  meetings 
overseas  with  the  people  who  held  themselves  out  as  officials 
of  the  Saudi  Arabian  government,  and  other  major 
organizations,  seemed  to  indicate  that  the  guy  was  who  he 
said  he  was.   So  I  thought  at  best  at  that  point,  it  was 
about  a  50/50  proposition. 

Q    Did  Colonel  North  expres 
view  as  to  al-Masoudi 's  bonafides? 

A    I  think  that  shortly  thereafter,  that  he  sent 


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MtxcR  mromMa  co..  inc. 

507  C  Streei.  N  E  25 

Vuhuifioti.  DC-    20002 
(202)  H6-6Ui 


wussm 


398 


somebody  to  Jedda,  and  his  words  were  that  his  friend  went  and 
had  green  tea  with  the  real  Jewel,  and  our  guy  didn't  ever 
register,  is  what  he  said. 

Q    Was  the  person  that  he  sent  to  Jedda  to  drink  this 
green  tea  Mr.  Kopp? 

A    I  believe  it  was  Mr.  Kopp,  but  I've  got  very  little 
to  go  on  in  that  belief. 

Q    And  by  Mr.  Kopp,  at  least  I  am  referring  to  General 
Secord. 

A    Yes. 

Q    I  take  it  that's  your  understanding  to  that  as  well? 

A    Yes. 

Q    Do  you  recall  the  date  of  your  first  interview  with 
the  FBI  agent? 

A    Not  specifically.   I  wouldn't  call  it  much  of  an 
interview.   I  wholesale  turned  over  to  him  all  the  paperwork 
that  I  had.   In  fact  I  gave  him  some  of  my  originals  of  the 
al-Masoudi  materials 

Q    Did  that  interview  take  place  in  early  September 

1985? 

A    That  sounds  about  right.   Tt  was  in  my  office. 

MR.  DUDLEY:   We're  not  talking  about  the  meeting  in 
Philadelphia? 

THE  WITNESS:   No,  no.   In  my  office. 

BY   MR.    KAPLAN: 


mmwa 


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!07  C  Scretl.  N  E  25 

Vuhin|iail.  O  C      20002 
(202)  )46.«6M 


NCLASSra 


399 


Q    I  take  it — just  to  clarify  the  record — that  you  had 
a  brief  conversation  with  an  FBI  agent  in  Philadelphia  some 
time,  a  couple  months  prior  to  this  at  least  formal  meeting 
with  the  FBI  that  took  place  in  your  office? 

A    Yes. 

Q    With  Agent  Kumars ik  from  the  Washington  Field 
Office,  is  that  correct? 

A    Correct.  And  the  Philadelphia  agent  expressed  no 
reservation  about  the  guy's  identify,  so — 

Q    Okay.   Did  you  have  any  discussions  with  Colonel 
North,  that  you  recall  today,  about  what  kind  of  information 
you  would  give  to  the  FBI  agent,  prior  to  the  first  interview 
in  early  September  1985? 

A    I  don't  recall,  specifically,  a  conversation  about 
what  I  would  give  the  agent. 

Q    Did  Colonel  North  ask  you  to  hold  back  any  informa- 
tion from  the  FBI  agent? 

A    I  don't  remember  him  asking  me. 

Q    Did  you  tell  the  FBI  agent  that  the  CIA  had  passed 
on,  at  least  for  the  time-being,  the  bonafides  of  al-Masoudi? 

A    I  don't  recall  that,  but  if  it  had  been  done  by 
that  time  I  probably  would  have  passed  that  on  to  him. 

Q    There  would  have  been  no  conscious_  decision^  on 
your  part,  not  to  have  held  out  to  the  FBI? 

A    Well,  in  all  honesty,  if  I  was  worried  about  that, 


lecision,    on 

NCIASS! 


405 


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■■LLBI  HCTOKTMa  CO,  Ma 

>07  C  Street.  NE  25 

Wadunitoo.  O  C.     20002 
(2a2)Vt6-MM 


M! 


iiAssra 


400 


I  certainly  would  not  have  given  him  all  the  records  I  gave 
him.  I  gave  him  my  originals  on  several  documents  and  I've 
never  gotten  them  back,  so-- 

Q    My  question  a  moment  ago  was,  did  North  ask  you  to 
withhold  any  information  from  the  FBI.   I  just  want  to 
rephrase  it  so  that  we  don't  get  caught  up  in  a  semantic 
difference. 

Did  North  instruct  you  to  withhold  any  information 
from  the  FBI  in  the  interview  that  you  had  in  early  September? 

A    Not  that  I  recall. 

Q    Did  you  inform  North  that  this  interview  was  going 
to  take  place? 

A    Probably. 

Q    Did  you  talk  with  North  afterwards  about  the 
substance  of  the  interview? 

A    Yes. 

Q    All  right.   Now  from  a  variety  of  documentation  that 
we  have,  and  some  of  which  we  discussed  a  moment  ago — that 
is,  the  Treasury  reports — you  continued  to  deal  with  al- 
Masoudi  for  some  time  after  September  of  1985,  is  that 
correct? 

A    Yes. 

Q    When  did  you  conc^lud^t^ha^  ^l^^Mdaoudi^as  in  fact  an 
imposter? 


mtm 


Well,  I  knew  for  sure  when  whoever  it  was  went  to 


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Mun  nrottma  co..  mc. 

50?  C  Sum.  N  E  25 

Wuhiflfion.  D  C     20002 
(202)  V<6-MM 


401 


drink  green  tea  with  him,  but  I  can't  tell  you — 

Q    Do  you  recall  when  that  was? 

A    I  don't  recall  the  precise  date  of  that.   What 
happened  after  Kumarsik  came  to  see  me  the  first  time,  was 
that  I  went  to  the  Library  of  Congress  because  I  figured  that 
their  records  would  be  more  complete  than  the  McKelden 
Library,  and  I  tried  to  find  as  much  as  I  could  about  Ibrahim 
al-Masoudi,  and  the  genealogical  lines  that  he  had  implied  in 
previous  conversations. 

And  again  I  provided  that  information  to  North.   I 
was  very  skeptical  of  him  while  he  was  in  Geneva,  and  in  fact 
I  was  preparing  to  send  him  a  final  transfer,  and  ultimately 
called  Kumarsik  and  said,  look,  you  know,  I'm  still  sending 
this  guy  money.   If  you  believe  him — if  you  can  prove  that  he 
is  not  who  he  says  he  is,  then  you'd  better  tell  me  now 
because  I'm  sending  him  money. 

And  Kumarsik  said,  "I  wouldn't  send  him  any  more 
money  if  I  were  you.   I  don't  think  he  is  who  he  says  he  is." 

Q    Do  you  recall  when  that  was? 

A    Well,  some  time  in  October,  I  guess. 

Q    Was  this  in  late  October,  jarly  November,  when  in 
fact  you  did  send  him  some  traveler's  checks? 

A    Probably.   But  the  DEA  guys  and  Kopp  continued  with 
him  for  a  very  short  period  of  time  after  I  was  ready  to  be 
done  with  him,  and  it  had  to  do  with  the  hostages,  and  this-- 


ffliSSIFIFn 


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>07  C  SatCT.  N  E-  2  5 

VldunfTOO.  DC.     a>002 
{101)  )46-MM 


FIED 


402 


something  that  was  going  on  at  the  time,  and  somehow  he  was 
involved.   So  there  was  some  activity,  even  after  I  knew  him 
to  be  an  imposter,  and  he  received  some  money  from  me,  even 
after  I  knew  him  to  be  an  imposter. 

Q    Did  North  encourage  you  to  continue  dealing  with 
r.  1-Masoudi  after  you,  in  your  own  mind,  determined  that  you 
thought  he  was  an  imposter? 

A  Actually,  he  asked  me  to  get  out  of  the  middle  of 
it,  and  al-Masoudi  kept  trying  to  draw  me  back  into  it,  and 
North  kept  asking  me  to  stay  out  of  it,  and  I  agreed  to  that. 

Q    But  you  did  testify  that  North  approved  the 
traveler's  checks  that  were  sent  on  November  1st  and  November 
6th  of  1985? 

A    Right. 

Q    Did  you  ever  have  any  discussions  with  North,  or 
conversations  with  North  about  delaying  the  investigation 
into  al-Masoudi 's  bonafides? 

A    No. 

Q    Did  North  ever  suggest  to  you  that  it  would  be 
best,  for  any  reason,  if  that  investigation  were  delayed? 

A    Not  that  I  recall. 

Q    Did  there  come  a  time  when  you  cut  off  all  contact 
and  communications  with  al-Masoudi? 

A    Well,  I  stopped  dealing  with  him  I  guess  the  day  he 
called  me  from  jail  in  Geneva. 


UNCUISSinED 


408 


1%'0LA$SIFI£D 


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Mujn  nromma  Co..  mc. 

507CSum.  N.E  25 

Vuhmfton.  D  C.    20002 
(202)  M«.6«M 


Q    When  was  that? 

A    I  think  it  was  some  in  November.   Some  time  in 
November . 

Q    Do  you  recall  a  conversation  with  Agent  Kumarsik 
toward  the  end  of  October  of  1985  in  which  you  told  Kumarsik 
that  you  would  completely  cooperate  with  the  FBI  to  attempt 
to  lure  al-Masoudi  to  the  United  States? 

A    Yeah.   In  fact  that  was  the  last  conversation  I  was 
recounting  to  you.   Basically  what  I  said  to  him  was,  that 
the  only  person  I  knew,  that  he  still  thought,  to  his  way  of 
thinking- -al-Masoudi 's  way  of  thinking — I  was  the  only 
individual  that  he  still  believed  believed  in  him. 

And  if  I  had  told  him  that  everything  was  all 
right,  come  on  home,  he'd  come  on  home. 

Q    Nonetheless,  you  made  some  payments  of  some  $14,000 
to  al-Masoudi  in  Geneva  after  the  agreement  that  you  would 
cooperate,  and  those  payments  were  approved  by  Colonel  North? 

A    That's  correct. 

MR.  KAPLAN:   I'm  going  to  ask  the  reporter  to  mark 
as  Deposition  Exhibit  28,  a  copy  of  what  appears  to  be  a 
Telex  from  you  to  a  Mr.  Robert  Vidon,  and  a  Mr.  Cockrell  at 
the  Credit  Suisse  Banque,  in  which  you  inform  them  that  al- 
Masoudi,  or  anyone  purporting  to  be  al-Masoudi,  has  no 
authority  to  act  in  any  manner  as  an  agent  of  IBC. 
THE  WITNESS:   Correct. 


WM 


jwoiRE 


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m»±B>  KtKxnwa  CO..  mc. 
J07  C  Street.  N  E  25 

Vtihuifion.  D  C.     20002 


mmmi 


404 


BY   HR.    KAPLAN! 

Q    Did  IBC  have  accounts  at  the  Credit  Suisse  Banque? 

A    No,  no.   al-Masoudi  had  represented  to  me  that 
these  individuals  had  set  up  an  account  for  him,  and  that  he 
was  going  to  use  the  account  for  his  gold  and  oil  transac- 
tions, these  transactions  for  the  benefit  of  the  resistance. 

Q    Because  he  had  informed  you  that  this  contract  was 
in  the  name  of  International  Business  Communications,  is  that 
why  you  wanted  to  make  clear  to  these  individuals  that  he  had 
no  authority  to  act  on  their  behalf? 

A    That's  precisely. 

MR.  KAPLAN:   Off  the  record  for  a  second. 
[Brief  discussion  off  the  record.] 
BY  MR.  KAPLAN: 

Q    Have  you,  Mr.  Miller,  made  a  calculation  of  the 
amount  of  money  that  you  expended  on  activities  that  you 
undertook  with  al-Masoudi? 

A    Yes. 

Q    How  much  money  was  that? 

A    At  the  present  time,  in  professional  and  expense 
reimbursements,  travel  and  so  forth,  it  is  about  $367,000. 

mm  kQQKKn 

[Witness  and  attorney  consult.] 

THE  WITNESS:   The  thing  that's  not  calculated  in 
that  figure  is  expenses  by  myself  personally,  and  he  lived  at 


410 


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mxiR  nromma  Co..  mc. 
507  C  Sam   N  E  25 

VuhiniTon.  D  C     2000] 
(202)  V46.«M6 


UNCLASSIFIED 


405 


niy  house  for  an  entire  month,  and  he's  a  very  expensive 
individual .  So  I  have  no  idea  what  my  personal  loss  is 
associated  with  it. 

BY  MR.  KAPLAN: 

Q    Okay.   Can  you  describe,  for  the  record,  what  sorts 
of  items  this  money  was  used  to  pay  for. 

A    Traveler's  checks  for  his  travel  overseas,  reimbur- 
sement for  office  expenditures,  air-traffic  expenses,  and  in 
the  case  of  one  item,  $104,000  to  his  attorneys  for  the 
reimbursement  of  forfeiture  of  a  performance  bond. 

Q    That's  the  disbursement  to  Gary  Bagdasarian  that 
you  testified  about  yesterday? 

A    Correct.   And  25,000  in  good-faith  payment  to  the 
William  Penn  Bank  in  Philadelphia. 

Q    How  much  of  those  expenses,  if  you  know,  could  be 
allocated  or  attributed  to  al-Hasoudi's  hostage-rescue 
efforts? 

A    I've  never  separated  it  out  that  way. 

Q    Approximately.   Would  it  be  half  of  that? 

A    I  would  say  that  the  largest  expenditures  for  al- 
Masoudi  came  at  a  time  when  he  had  already  begun  to  olfer 


help,  and  that  probably  was  a  pretty  significant  factor  in 
extending  him  the  credit.    \\^l   \  h\\lf\i 

Q    Was  North  kept  regularly  apprised  of  your  expenses 


as  well  as  your  activities  with  al-Masoudi? 


411 


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uiLLn  ntpoitTiNa  co..  mc. 

107  C  Stittt.  N  E  25 

Waihmitoa.  D  C     20002 
(202)  M6-6M« 


WLASSIHED 


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A  Yes. 

Q    Did  North  approve  these  expenses? 

A    He  approved  the  large  ones,  in  specific,  and  in 
general,  the  smaller. 

Q    What  was  the  ultimate  source  of  the  money  expended 
or  lost  on  al-Masoudi? 

A    Well,  in  terms  of  the  1099-income  that  I  just 
recounted  to  you,  that  we  have  charged  him  with  under  a  1099- 

Q    Charged  who  with? 

A    al-Masoudi.   Most  of  that  money  now  has  been  fully 
reimbursed  out  of  the  assistance  money. 

Q    That  is  the  centra-assistance  money  that  was  paid 
to  IBC  by  NEPL? 

A    By  NEPl  and  other  sources . 

Q    When  you  say  most  of  that  money  has  been  reimbursed, 
is  that  separate  from  the  10  percent  charge,  or  commission 
that  you  began  to  take  in  1986,  and  to  which  you  testified 
yesterday,  and  on  June  2  3rd? 

A    That's  correct. 

Q    Who  approved,  if  anyone,  the  reimbursement  from  the 
NEPL  contra-assistance  payments,  of  these  monies  expended  on 
behalf  of  al-Masoudi's  activities^ -„,  ^„  flrtrtiBTf?"P\ 

A    colonel  North.  0  ll  ||U"l5dl  M  lO 

Q    Was  there  a  specific  conversation,  or  conversations 


412 


art407 


mixK  KcroirnHO  co..  mc 

507  C  Scictt.  N  E 
Vuhioiuxi.  O  C     20002 
(202)  V<4-««M 


mmim 


407 


with  North  in  which  you  asked  him  for  reimbursement  for  these 
losses? 

A    Yes. 

Q    Did  he  tell  you  that  you  should  reimburse  yourself 
for  these  losses  from  the  contra-assistance  payments  that 
were  being  made  by  NEPL  to  IBC7 

A    Yes. 

MR.  KAPLAN:   I  have  no  further  questions.   Thank 
you. 

[Whereupon,  at  12:15  p.m.,  the  deposition  was 
adjourned. ] 


iClilSSIFlEO 


413 


■un  Mpornvra  oo,  mc 

107  C  Sam.  N  £. 
Vaihiafua.  DC.    2000} 
(202)  V««4<M 


UNCUSSIFIED 

CERTIFICATE  OF  NOTARY  REPORTER 


I,  Terry  Barham,  the  officer  before  whom  the 
foregoing  deposition  was  taken,  do  hereby  certify  that  the 
witness  whose  testimony  appears  in  the  foregoing  transcript 
was  duly  sworn  by  me;  that  the  testimony  of  said  witness  was 
taken  by  me  and  thereaftrer  reduced  to  typewriting  by  me  or 
under  my  supervision;  that  said  deposition  transcript  is  a 
true  record  of  the  testimony  given  by  said  witness;  that  I  an 
neither  counsel  for,  related  to,  nor  employed  by  any  of  the 
parties  to  the  action  in  which  this  deposition  was  taken; 
and,  further,  that  I  am  not  a  relative  or  employee  of  any 
attorney  or  counsel  employed  by  the  parties  hereto,  nor 
financially  or  otherwise  interested  in  the  outcome  of  the 
action. 


^ — Terry 
and  for 


My  commission  expires  May  15,  1989. 


Birhanij^^Wotary  Pu 
orj  th^TDistrict  of 


Public  in 
Columbia 


UNWSSIFIED 


415 


BNWssro 

ORCUSSIFIED 

SELECT  COMMITTEE  TO  INVESTIGATE  COVERT 

ARMS  TRANSACTIONS  WITH  IRAN 

U.S.  HOUSE  OF  REPRESENTATIVES 

AND 

SELECT  COMMITTEE  ON  SECRET  MILITARY  ASSISTANCE 

TO  IRAN  AND  THE  NICARAGUAN  OPPOSITION 

UNITED  STATES  SENATE 

Tuesday,  September  15,  1987 
Washington,  D.C. 
Deposition  of  RICHARD  RODERICK  MILLER  taken  on 
behalf  of  the  Select  Committees  above  cited,  pursuant  to 
notice,  commencing  at  9:30  a.m.  in  Room  901  of  the  Hart 
Senate  Office  Building,  before  Ronald  Meek,  a  notary  public 
in  and  for  the  District  of  Columbia,  when  were  present: 
For  the  House  Select  Committee: 


THOMAS  FRYMAN,  Esq. 
SPENCER  OLIVER,  Esq. 
VICTOR  ZANGLA,  Esq. 


For  the  Senate  Select  Committee 
KEN  BUCK,  Esq. 


Partially  Declassified/Released  on   A?-  :£^  -  P7 
under  provisions  of  E.O.  12356 
by  N.  Menan,  National  Security  Council 


midssw 


mujui  iwpumiNO  eo-  wc 

Kl  C  imn.  N  E 

Vuhufoo.  O  C     20002 


H^ 


416 


KUiSSue 


MUXK  HVOimiM  CO..  MC. 
507  C  Suitt.  N  E 
Vuhington.  O  C      :0002 
fjnn  A.'A-AM6 


For  the  deponent: 

RONALD  G.  PRECUP,  Esq. 
Nussbaum,  Owen  &  Webster 
One  Thomas  Circle 
Washington,  D.  C.  20005 


CONTENTS 

Examination  by  counsel  for 

Paqe 

House  Select  Committee 

411 

EXHIBITS 

Exhibits 

Marked 

29 

441 

30 

4)2 

31 

532 

32 

•'-•• 

33 

(=25 

HMUssro 


;  -  ■»  .\  J 


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mjLtK  RooimNO  CO..  mc 

507  C  SuMt.  N  E  25 

Wuhiofnin.  DC     20002 
(202)  M«-MM 


ONCUISSIHEO 


411 


Whereupon, 

RICHARD  RODERICK  MILLER 
was  called  as  a  witness  and,  having  previously  been  duly 
sworn,  was  further  examined  and  further  testified  as  follows: 

EXAMINATION  BY  COUNSEL  FOR 

THE  HOUSE  SELECT  COMMITTEE 

BY  MR.  FRYMAN: 
Q    Mr.  Miller,  this  is  a  continuation  of  your  prior 
deposition  before  the  Senate  and  House  Select  Committees. 
You  are  still  under  subpoena,  and  the  immunity  orders  of  the 
two  Committees  which  have  been  marked  as  exhibits,  continue 
to  be  applicable  to  this  session  today,  and  I  again  remind 
you  that  you  are  still  under  oath  from  your  previous  sessions. 

By  this  first  question,  you  will  know  inw^  we  are  in 
this  secure  room. 

Mr.  Miller,  have  you  ever  been  employed  by,  or  have 
you  ever  been  a  contract  agent  for  any  intelligence  agency, 
including  the  National  Security  Agency  or  the  National 
Security  Council,  or  any  intelligence  branch  of  any  depart- 
ment or  agency? 

A    No,  other  than  the  business  relationship  which  I've 
already  described  to  you  with  Oliver  North,  and  the  short 


period  I  worked  for  the  Federal  Preparedness  Agency  at  GSA 


<N 


which  was  about  three  months.   That  doesn't  qualify  as  an 
intelligence  agayar,  j^ft  '^  ^qn  jmw^^^  the  FEMA,  Federal 


n(!r/«?i?M 


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art412 


UNCLASSIFIED 


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>07  C  SuCTi.  N  E 
Wuhufion.  DC      2O0O2 


Emergency  Management  Administration. 

Q    Well,  your  work  with  Colonel  North,  did  you 
consider  that  work  to  be  work  for  an  intelligence  agency? 

A    No. 

Q    Did  you  consider  yourself  to  be  a  contract  agent 
for  any  intelligence  agency? 

A    No. 

Q    Were  you  ever  present  in  Colonel  North's  office 
when  he  placed  a  telephone  call  to  Bunker  Hunt? 

A    I  think  I  was  present  in  his  office  when  he  called 
Bunker  Hunt.   I  remember  the  specifics  of  his  conversation, 
but  I  can't  tell  you  whether  I  was  there,  or  whether  he 
repeated  it  to  me. 

Q  Was  it  your  understanding  that  at  the  time  Colonel 
North  had  this  telephone  conversation  with  Bunker  Hunt,  that 
William  Casey  was  present  in  Mr.  Hunt's  office? 

A    That's  correct,  although  I'm  not  sure  it  was  the 
of£J.ce.   I  was  under  the  impression  it  was  his  house. 

Q    How  did  you  know  this? 

A    He  told  me. 

Q    Colonel  North  told  you? 

A    Colonel  North  told  me.   That's  right. 

Q    What  did  he  tell  you  about  this  conversation? 

A    He  told  me  that  he  called — he  recited,  I  think, 
three  of  the  four  items  that  I  asked  him  to  discuss  with  Mr. 


419 


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MJJR  nvomvra  CO..  mc. 
M)7  C  Scmr.  N  E  25 

WsahiAfton.  D  C.     20002 


UNCUSSIFIED 


413 


Hunt,  and  Mr.  Hunt  said  "I  have  a  friend  of  yours  here,"  and 
Ollie  said  he  said  who's  that,  and  he  said,  "Bill  Casey,  •  and 
Ollie  said,  "Give  him  my  regards."   And  I  don't  think  he 
recounted  that  he  and  Casey  actually  talked. 

Q    What  were  the  items  that  you  had  asked  Colonel 
North  to  discuss  with  Mr.  Hunt? 

A    I  have  to  do  it  from  memory.   They're  on  a  piece  of 

paper  that  you've  already  got  in  your  exhibits.   But  that 

there  was  an  ongoing — the  basic  thrust  was  that  there  was  an 

ongoing  supply  effort,  and  that  Bunker's  money  had  helped  to  I 

j 
produce  that,  and  what  was  needed  was  the  second  half  of  his   ! 

contribution.  j 

! 
Q    Do  you  recall  when  this  conversation  occurred?      j 

A    All  I  can  remember  is  that  he  was  in  his  old 
office.   I  don't  remember  a  specific  date. 

Q    When  did  he  leave  his  old  office,  as  you  recall? 

A    I  don't  remember,  specifically. 
-  Q    Did  Colonel  North  tell  you  Mr.  Hunt's  response  to 
these  matters  that  he  had  raised  with  him? 

A    I  don't  recall  any  commitment  coming  out  of  the 
conversation  from  Mr.  Hunt.   I  don't  remember  any  commitment 
by  Mr.  Hunt  as  a  result  of  the  conversation,  although  at  a 
later,  much  shorter  period  of  time  from  then,  he  did  make 
good  on  the  second  half  of  his  contribution. 

Q    Did  Co^<iq^i^grtJi^^a<V^.%Si.^^   anything  that  Mr. 


iTK(f«i)f(jmitrf 


420 


OILASSIFIED 


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WuhiaitM.  0  C.    20002 


Hunt  had  said  in  this  conversation? 

A    The  only  thing  I  can  remember  is  what  I've  just 
told  you. 

Q    With  respect  to  the  presence  of  Mr.  Casey? 

A    Correct.   That's  not  uncharacteristic  of  Mr.  Hunt, 
either.   He  tends  to  be  much  more  of  a  listener  than  a 
speaker. 

Q    Did  Colonel  North  say  anything  to  you  with  respect 
to  why  Mr:  Casey  was  in  Mr.  Hunt's  office  at  that  time?- 

A    No. 

Q    Mr.  Miller,  do  you  recall  any  discussions  with 
Frank  Gomez  about  what  I  will  describe  as  the  "contra- 
assistance  network"  or  the  group  of  bank  accounts  of  IBC,  IC, 
Inc.,  and  NEPL,  and  Mr.  Gomez's  reservations  about  the  use  of 
these  accounts  for  transferring  funds? 

A    I  would  say  that  Frank  expressed  a  reluctance  to  be 
involved  in  the  private  funding,  initially  because  it  involved 
IBC  directly,  and  I  think  we  were  agreed  that  that  was 
something  to  be  changed.   And  then,  ultimately,  I  think  he 
did  it  for  personal  commitment  reasons  to  the  cause,  but 
again,  I  think  with  some  reservation,  and  I  think  I  prevailed 
upon  him  because  I  was  convinced  that — and  I  think  he  was  con- 
vinced--there  wasn't  anybody  else  to  do  it  at  the  time. 

Q    Was  that  the  argioment  you  made  to  him  as  to  why  you 
should  do  it? 


UNCIASSIHED 


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muMK  MPOmwo  CO..  mc. 
507  C  Siren.  N  E  25 

Wuhington.  D  C      20002 


OILASSIHED 


415 


A    Yes.  I 

Q    Did  you  make  any  other  arguments?  | 

I 

A    Not  that  I  recall.   In  fact  I  don't  remember  that   [ 

one  in  specific  terms,  but  I'm  pretty  certain  that  was  the    | 

I 

thrust  of  my  appeal  to  him. 

Q    Why  did  you  believe  that  you  and  your  organizations  j 
were  the  only  person  and  entity  that  could  do  this?  ] 

A    We  were  very  familiar  with  the  other  political 
organizations  that  were  involved,  and  none  of  them  seemed  to 
be  directing  raw  financial  resources  to  the  resistance.  A 
lot  of  them  were  spending  money  on  political  activities,  but 
nobody  was  giving  money,  or  working  to  raise  money  and  give 
it  directly  to  the  resistance.   A  lot  of  people  claimed  they  | 
were,  but  it  wasn't  happening. 

So  there  seemed  to  be  nobody  else  doing  it,  and 
Colonel  North  seemed  to  be  in  desperate  need  of  somebody  to  do 
it,  and  those  two  things  led  me  to  conclude  that. 

-  Q    As  I  understand  your  prior  testimony.  Colonel  North 
merely  asked  you  to  provide  a  bank  account,  or  bank  accounts, 
where  monies  could  be  deposited,  and  from  which  he  could 
direct  disbursement  from  the  accounts . 

Is  that,  in  substance,  what  he  asked  you,  or  the 
assistance  that  he  asked  you  to  provide? 

A    No,  I  don't  think  so,  because  our  involvement  with 
the  financial  end  really  started  with  al-Massoudi,  which  was 


end  really  started  with  . 

mm  ipoinm 


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it*xn  MMMTwa  CO..  wc 

507  C  Sum.  N  E  25 

Wnhmpoo.  D  C     20OO2 
(202)  V<6-MM 


UNCUSSIFIED 


416 


far  more  complicated  than  that,  and  progressed  through 
actually  going  out  and  raising  funds,  by  virtue  of  the 
conversations  with  John  Ramsey  at  what  seemed  to  be  critical 
moments  in  Colonel  North's  timetable. 

And  he  was  quite  clear  that  we  were  involved  from 
the  beginning  with  a  fund-raising  effort,  and  I'm  sure  he 
understood  that  that  entailed  much  more  than  just  setting  up 
bank  accounts . 

Q    .You  recall,  do  you  not,  Mr.  Miller,  and  you  have 
testified  about,  have  you  not,  a  meeting  that  you  attended 
with  Colonel  North  and  Mr.  Channell  in  July  of  1985,  where 
there  was  a  discussion  of  how  funds  would  be  transferred  that 
were  raised  by  NEPL? 

A    Yes. 

Q    It  was  at  this  dinner  meeting  that  Colonel  North 
told  Mr.  Channell  that  the  funds  should  be  transferred  to  the 
IBC  account,  or  to  one  of  your  accounts? 
.  A    Correct . 

Q    You  understood  from  Colonel  North,  that  you  would 
follow  his  directions  about  the  disbursements  of  the  funds 
transferred  to  you  from  Mr.  Channell,  is  that  correct? 

A    That's  correct. 

Q    Now,  following  that  conversation,  funds  transferred 
by  Mr.  Channell  to  your  accounts  exceeded  several  million 
dollars,  did  they  not? 


UNCLASSIRED 


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>07  C  Strcn.  N  E  25 

Waihinitoa.  D  C     20002 


A    That's  correct. 

Q    What  was  the  amount  of  funds  that  you  were  respon-  ! 
sible  for  raising  directly  for  the  contras?   Was  it  under     1 

$100,000?  I 

I 

A    I  don't  think  you  can  place  it  in  that  context 
because  we  were  responsible  to  Mr.  Channell  for  activities  and| 
work  assignments  that  led  to  him  raising  that  money.   So  if 
you  would  like  to  take  all  the  millions  of  dollars  and  take 
some  percentage  of  it,  I  might  try  and  agree  with  you,  but  I 
can't  put  a  number  on  that. 

Q    But  the  contributions  that  you  asked  for  yourself 
totalled  less  than  $100,000,  did  they  not? 

A    What  do  you  mean,  "asked  for  myself"? 

Q    Well,  did  you  ever  ask  a  contributor,  or  ask  anyone 
to  contribute  funds  for  the  purpose  of  assisting  the  Nicara- 
guan  resistance? 

A    Yeah.   I  made  the  direct  appeal  to  John  Ramsey  on 
two  occasions.   We  had  the  direct  appeal  to  Mrs.  Newington  on 
another  occasion.   Those  were  the  only  times  I  actually  asked 
somebody  for  money.   The  rest  of  the  times  I  was  present,  or 
a  large  number  of  the  rest  of  the  times  X  was  present. 

Q    So  with  respect  to  the  responsibility  for  maintain- 
ing an  account  to  receive  funds  from  Mr.  Channell,  and  to 
disburse  funds  from  that  account  pursuant  to  the  direction  of 
Colonel  North,  to  perform  those  functions  it  was  not  necessary 

!!MPi  spcinrn 


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WmK.«-~     r,  c,    2000J 


to  have  any  relationship  with  the  political  figures  in  the 
Nicaraguan  resistance,  or  to  have  any  relationship  with 
contributors,  was  it  not? 

A    I'm  afraid  I  don't  understand  your  question.   If 
your  implication  is  that  that  activity  was  somehow  discon- 
nected from  the  rest  of  the  activities  that  we  performed  for 
Mr.  Channell,  or  Colonel  North,  or  the  political  resistance, 
I  totally  disagree  with  that. 

Q    Well,  Mr.  Miller,  whether  it  was  disconnected,  or 
not,  it  was  not  necessary,  in  order  to  operate  these  two 
accounts,  and  receive  funds  from  Mr.  Channell  and  disburse 
funds  according  to  the  direction  of  Colonel  North,  that  you 
have  any  relationship  with  members  of  the  resistance,  or  that 
you  have  any  relationship  with  Mr.  Channel! 's  contributors, 
was  it? 

MR.  PRECUP:   Objection.   Mr.  Fryman,  would  you 
reformulate  that.   I  think  the  witness  is  having  trouble  with 
the  word  "necessary. "   Necessary  on  what  basis?   I  think 
he's  explained  as  a  matter  of  fact  what  occurred,  and  has 
also  testified  that  that  was  an  important  connection  on  all 
ends  of  those  fronts,  for  him.   So  it's  very  difficult  for 
him  to  deal  with  the  word  "necessary"  which  may  be  used  in  a 
vacuum. 

MR.  FRYMAN:   All  right.   Mr.  Precup,  what  I  am 
trying  to  do  i|_li»^  follow  upon  his  prior  answer,  where  he 


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said  that  he  explained  to  Mr.  Gomez,  that  if  Mr.  Miller  and 
IBC  did  not  perform  this  function  that  had  been  requested  by 
Colonel  North,  there  was  no  one  else  to  do  it. 

What  I  fail  to  understand  is  what  was  unique  about 
Mr.  Miller's  situation,  or  IBC's  situation,  and  why  someone 
else  could  not  do  that,  and  that's  my  ojb^oct^ron  in"a^«^line 
of  questioning. 

MR.  PRECUP:   Well,  perhaps  the  witness  could  answer 
that  general  inquiry  of  yours. 

THE  WITNESS:   Well,  as  I  told  you  previously,  I  am 
very  conversant,  and  we  were  at  the  time  very  conversant  with 
the  other  organizations  who  were  capable  of  raising  money  and 
working  with  fund-raisers,  and  working  with  the  resistance 
figures,  and  who  had  Colonel  North's  trust,  and  I  didn't  feel 
there  was  anybody  else  out  there  who  had  the  right  elements 
to  do  this . 

I  didn't  see  anybody  else,  and  I  guess  Ollie  North 
didn't  either,  because  I  don't  get  the  feeling  he  asked  many 
other  people. 

BY  MR.  FRYMAN: 
Q    Well,  I  have  to  then  press  the  question,  Mr. 
Miller.   What  difference  did  it  make,  whether  or  not  you  had 
had  any  relationship  with  these  organizations?   Colonel  North 
was  instructing  Mr.  Channel!  to  transfer  funds  to  a  specific 
account,  and  ¥#V5*ik19  jfc^'Spr  prior  testimony,  he  was  giving 


to_your  prior  t 


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you  instructions  about  specific  accounts  to  which  you  were  to 
transfer  funds.  I 

Now  what  difference  does  it  make  as  to  whether  you 
had  had  any  prior  relationship  with  anyone  in  order  to 
perform  those  two  functions? 

A    Well,  if  I  gave  it  30  minutes  of  thought  I'd  come  up 
with  a  longer  list,  but  I  think  the  principal  elements  were 
the  trust  that  he  had  in  us.   I  think  they  were  the  trust  that 
Mr.  Channe'll  had  in  us,  and  I  think  it  was  the  trust  that  the 
resistance  figures  and  the  political  entities  had  in  us — were 
we  to  become  known  as  we  were,  eventually,  by  some  of  these 
people — that  they  would  not  be  upset,  or  they  would  not  be 
overly  concerned  about  the  involvement  that  we  had.   And  all 
those  things  turned  out  to  be  correct. 

And  so,  I  think  at  the  time,  it  was  an  intuitive 
decision,  but  I  think  it  was  accurate,  because,  ultimately, 
all  of  them  became  aware  of  our  responsibility  and  none  of 
them  seemed  to  have  voiced  much  distress  about  it. 

Q    When  did  you  understand  that  the  resistance 
figures,  or  any  of  the  resistance  figures  became  aware  that 
the  NEPL  funds  were  being  transferred  into  bank  accounts 
controlled  by  you,  and  disbursed  by  you? 

A    In  terms  of  having  NEPL  funds  transferred,  I  would 
say  not  until  November  or  December  of  this  past  year. 

funds  that  you  were  trans- 


Q    Well, 


llMl^rWiBrn 


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f erring,  other  than  NEPL  funds? 

A    Yes. 

Q    What  were  those? 

A    The  Heritage  Foundation  $100,000.   S60,000  from  a 
gentleman  by  the  name  of  MacAleer,  and  I  have  yet  to  know 
who,  exactly,  that  is.   And  another  gentleman  by  the  name  of 
Barness.   But  you  asked  the  question  in  terms  of  transferring 
NEPL  funds. 

They  were  aware,  long  before  then,  and  in  different 
times,  that  we  were  responsible  for  transferring  funds. 

Q  So  you  say  that  you're  not  aware  that  any  resistance 
figure  was  aware  of  your  role  in  transferring  NEPL  funds  prior 
to  November  of  1986? 

A    Well,  let  me  put  a  finer  point  on  it  than  that. 
They  were  not  aware  that  they  were  NEPL  funds  that  were  being 
transferred  to  them.   I  would  say  with  the  sole  exception  of 
Adolf o  Calero^who  had  some  indication  that — well,  he  had 
received  checks  directly  from  NEPL,  and  he  had  received  checks 
as_a  result  of  fund-raising  activities.   But  in  terms  of  our 
transferring  NEPL  funds  and  the  funds  being  known  as  NEPL 
money,  he'd  be  the  sole  exception  until  November  or  December. 

Q    When  do  you  understand  that  Mr.  Calero  first  became 
aware  that  you  were  transferring  funds  to  him  from  one  of 
your  accounts? 

A    I  had_a  jnfiaj:i|g^j4i|^4^f\  the  Connecticut  Club 


■  Jf^i- 


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INCUSSinED 


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Ui 


Hotel  in  late  October  or  November  of  '86,  and  in  that 
meeting,  per  Colonel  North's  instructions,  I  was  to  get  from 
him  a  bank  account  number,  and  corporate  name  to  carry  out  a 
transfer,  both  Colonel  North  and  I  knowing  that  I  already 
knew  it,  and  this  was  simply  Mr.  Calero  giving  it  to  me 
without  knowing  that  I  had  been  the  person  transferring  it 
before. 

Q    So  the  first  time  you  believe  that  Mr.  Calero  was 
aware  that  one  of  your  accounts  was  the  source  of  funds' 
transferred  to  him  was  October  or  November  1986? 

A    No.   Now  you've  changed  your  question.   We  trans- 
ferred from  IBC  to  the  NDC,  very  early  on  in  the  process, 
money  that  was  a  result  of  NEPL  fund-raising,  and  actually 
went — I  gave  the  check  to — i  think  it  was  Bosco  Matamoros, 
and  I  think  it  was  $25,000. 

Q    Well,  what  did  you  understand  was  the  significance 
of  this  conversation  you  just  described  in  October  or  November 
of -1986? 

A    It  was  the  first  time  that  Mr.  Calero  was  aware 
that  we  were  responsible  for  transferring  money,  large  sums 
of  money  into  his  accounts  from  overseas  bank  accounts. 

Q    How  much  money  did  you  transfer  to  Mr.  Calero  after 
October  or  November  19867 

A    We  made,  I  believe,  a  $75,000  transfer  and  an 
$80,000  transfer.   That's  off  the  top  of  my  head.   I  don't 


ii^i.-      That's  off  the  top 


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have  the  documents  in  front  of  me. 

Q    Your  explanation  to  Mr.  Gomez  as  to  why  your 
organization  should  perform  these  services  was  simply  that 
there  was  no  one  else  that  could  do  it? 

A    Well,  as  I  said,  I  think  that  was  the  principal 
thrust  of  my  argument  to  him.   I'm  sure  there  were  other 
elements  involved. 

Q    That's  what  you  recall  today? 

A    Yes . 

Q     Did  you  ever  discuss  the  propriety  or  legality  of 
your  organization  being  involved  in  these  transfers  with  Mr. 
Gomez? 

A     I  may  have  reported  back  to  him  on  my  conversations 
with  the  tax  attorney  at  the  time  of  the  al-Massoudi  business, 
and  I  probably  discussed  the  neutrality  ^ct  at  some  point 
with  him,  because  that  was,  again,  our  principal  focus  in  that 
timeframe. 

-  Q    Did  you  discuss  the  neutrality  act  with  any 
attorney? 

A  Not  in  that  timeframe,  no.  Actually,  I  considered 
Frank  more  expert  in  that  than  me,  after  20  years  of  foreign 
service. 

Q    The  consultation  with  the  tax  attorney  that  you 
referred  to  did  not  concern  the  transfers  of  Mr.  Channell  and 
the  -ii  nhiiT-comonhg,  j^rffl||-fH^hj|^r;gy^y|^HQr-»h9   xhe  specific 


iiwwt^^mtrf' 


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consultation  related  to  your  prior  involvement  with  al- 
Massoudi,  is  that  correct? 

A    I  think  you're  asking  me  to  discuss  matters  that  I 
discussed  with  my  attorney  at  the  time.   I'm  responsible  to 
answer  that? 

[Counsel  and  witness  confer.] 

THE  WITNESS:   Okay.   The  questions  with  the 
attorneys  involved  not  just  al-Massoudi,  but  also  the 
legality  of  handling  the  accounts,  and  the  way  they  wer^ 
handled. 

BY  MR.  FRYMAN: 
Q    Did  you  have  any  discussion  with  attorneys  about 
transfers  through  the  IBC  and  the  Cayman  Islands  account, 
after  your  meeting  with  Colonel  North  and  Mr.  Channell  in 
July  of  1985? 

A    I  mean  that's  all  the  way  up  till  today. 

MR.  FRECUP:  Yes,  it  is.  We  really  need  an  end 
date  on  that,  so  as  not  to  impinge  on  the  attorney-client 
privilege. 

THE  WITNESS:   Is  there  a  specific  timeframe  that 
you're  referring  to? 

MR.  FRYMAN:   Let's  say  during  the  period  beginning 
July  1985  through  November  1986. 

THE  WITNESS:   And  would  you  repeat  the  question. 

(The  reporter  read  back  the  pending  question.] 


reporter  reaa  oacK  tne  per 

TiMni  Aooirirf^ 


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THE  WITNESS:   Yes. 

BY  MR.  FRYMAN: 

When  were  those  discussions? 

May  of  1986. 

And  who  was  the  attorney? 

Earl  Dudley.   I  think  that's  right,  isn't  it?  May? 

Any  other  discussions  with  an  attorney  during  the 

time  period  July  1985  through  November  1986? 

A    ^ot  that  I  can  recall. 

Q    Mr.  Miller,  in  one  of  your  prior  days  of  testimony, 

you  stated  that  you  were  asked  to  provide  money  that  was  used 

in  an  effort  to  obtain  the  release  of  hostages  held  in 

Lebanon. 

Who  asked  you  to  provide  such  funds? 

A    Well,  Colonel  North  indirectly.   As  I  recall,  the 

money  was  requested  by  al-Massoudi  while  he  was  in  Geneva, 

and  I  confirmed  with  Colonel  North  that  it  was  appropriate, 

and  I  undertook  the  transfers. 

Q    How  much  money  was  involved? 

A    Well,  I  can  specifically  remember  one  transfer  of 

about  $18,000  was  involved.   There  was  another  time  when 

there  was  about  ^J.0, 000  in  airline  tickets,  and  the  latter 
A 

portion  of  al-Massoudi 's  stay  in  Geneva  was  predominantly 
because  he  was  supposedly  involved  in  this .   So  whatever 
money  he  spent  in  that  period  would  have  been  to  that  end. 


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Q  What  wa3  the  approximate  date  of  this  request? 

A  September. 

Q  Of  19857 

A  That's  correct. 

Q  The  request  came  directly  to  you  from  al-Massoudi? 

A  As  I  recall,  that's  correct. 

Q  What  was  explained  to  you  about  the  purpose  for 

which  these  funds  were  needed? 

,fl 
A   '\15,000  had  to  do  with  the  effort  to  secure  the 

A 

release  of  the  hostages,  and  I  don't  remember  anything 
specific  about  it,  and,  as  I  recall, ^3500  was  for  living 
expenses,  and  I  can't  right  now  remember  whether  it  was  al- 
Massoudi's  oif ^^^^^^^^^HIP^  ^9^"^ r  °^  ^^^   agent,  that  was 


there. 

Q    Was  the  $15,000,  to  your  understanding,  to  be  paid 
to  the  persons  holding  the  hostages? 

A    I  don't  believe  so.   I  mean,  if  that  was  the  case, 
it -wasn't  said  to  me. 

Q    Was  there  any  explanation  given  to  you  about  what 
was  to  be  done  with  the  )^15, 0007 

A    No. 

Just  that  they  needed ^15, 0007 

Yes. 

i 
You  said  there  was  a  later  10,0007 


A" 


I  believe  that's  correct,  yes. 


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427  -  I 


Q    What  explanation  was  given  to  you  about  the  need 
for  that  money? 

A     I  think  it  was  primarily  for  air  travel  involved 
with  al-Massoudi  and  some  associate  of  his,  and  I  don't  know, 
maybe  some  DEA  people. 

Q     Now  were  both  requests  in  generally  the  same  time 
period,  in  the  fall  of  1985,  or  around  September  of  1985? 
A    They  were  almost  all  of  them  in  the  fall  of  1985. 
Q    .Fall  of  1985.   Mr.  Miller,  has  your  organization 
been  involved  in  preparing  a  study  of  fund-raising  efforts 
within  the  United  States  for  either  the  Sandinisca  govern- 
ment, or  entities  sympathetic  to  the  Sandinista  government? 

A    We  prepared  a  white  paper  for  Mr.  Channel 1  on 
general  activities,  including  fund-raising,  and  political 
activities  by  members  of  the  left  wing  in  the  United  States. 
Q    When  was  this  prepared? 

A    I  think  we  transmitted  it  to  him  in  April. 
.  Q    Of  1987? 

A    That's  correct.   And  we  worked  on  it  for  about  five 
weeks,  I  think. 

Q    How  long  a  paper  was  it? 

A    It  was  in  inches.   The  entire  report  to  him  was 
about  eight  or  nine  inches  tall,  including  the  appendix,  and 

-    JNCLASSIflEP 

Q     Did  you  identify  in  this  white  paper  a  number  of 


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organizations  in  the  United  States  that  had  been  involved  in 
fund-raising? 

A    Yes. 

Q    Do  you  recall  the  number  of  organizations? 

A    No,  but  there  were  hundreds  of  them. 

Q    Hundreds? 

A    Hundreds .   Yes . 

Q    Over  a  thousand? 

A    It  seems  to  me  that  there's  over  a  thousand.   I'm 
not  sure  that  a  thousand  are  in  my  report,  but  there  are 
about  a  thousand  organizations. 

Q    How  did  you  develop  this  information? 

A    Mostly  from  existing  written  materials  from 
computer  data  bases,  and  through  research,  and  interviews 
with  members  of  the  House  and  Senate  staffs. 

Q    Which  House  staff  members  did  you  interview? 

A    I'd  have  to  talk  to  the  researcher  that  handled  it, 
but  they  talked  to  some  of  the  Senate  Foreign  Relations 
stjiff,  and  I  believe  they  talked  to  some  people  on  the  House 
Foreign  Affairs  Committee  staff,  but  I  don't  know  who. 

Q    Who  was  the  researcher  who  handled  this? 

A    Fran  Jacobawitz.   And  also  Jeff  Keffer  of  my  staff. 

Q    You  were  paid  to  do  this  by  Mr.  Channell? 

A    That's  correct. 

Q    How  much  did  he  pay  you? 


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A    I  believe  it  was  15,  or  maybe\l2,000.   I'd  have  to 
look  at  the  invoice. 

Q    Did  Mr.  Channell  indicate  to  you  what  use  he 
intended  to  make  of  this? 

A    His  concern  was  that  there  was  a  lot  of  political 
attacYtaking  place  against  him  by  members  of  Congress  who 
were  ignoring  similar  activities  by  people  on  the  left. 

Q    What  use  did  you  understand  he  was  to  make  of  this 
report? 

A    He  was  supposed  to  use  it  to  go  to  contributors  and 
attempt  to  raise  money  for  a  larger  public-affairs  effort  in 
the  area  of  Central  America. 

Q    Did  you  provide  Mr.  Channell  with  a  number  of  copies 
of  the  report? 

A    As  I  recall,  I  provided  him  three  copies. 

Q    You  kept  a  copy,  I  take  it? 

A    I  believe  I  did,  yes.   I'm  not  sure  I  kept  all  the 
appendixes,  although  I'm  sure  they're  interstrewn  in  the 
files.   A  lot  of  what  we  put  in  there  was  stuff  that  we'd 
accumulated  over  the  last  three  or  four  years — mailings  by 
other  organizations,  materials  attached  in  forms,  and 
debates;  things  we  received  by  requesting  a  mail  copy  of 
something. 

Q    Did  you  suggest  this  project  to  Mr.  Channell? 

A    No.   In  fact  I  think  it  was  his  suggestion. 

lliioi  «00irirr> 


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Q  Did  you  ever  discuss  with  Mr.  Channell  making  this 
report  available  to  any  Members  of  Congress? 

A    No.   In  fact,  my  counsel  was  that  if  it  were  made 
available  to  Members  of  Congress,  it  would  be  an  open 
declaration  of  war  between  the  left  and  the  right,  and  that 
the  struggle  was  already  screwed  up  enough,  and  it  didn't 
need  to  be  that  politicized,  and  my  recommendation  was  that 
it  not  be  used  as  a  political  weapon.   That  was  what  I 
remember  my  counsel  to  him  being. 

Q    Are  you  suggesting  by  your  answer  that  there  was, 
then,  a  discussion  with  Mr.  Channell  about  whether  or  not  it 
should  be  made  available  to  Members  of  Congress? 

A  Absolutely,  and  in  public.  Mr.  Channell  wanted  to 
make  it  a  public  doctunent,  and  I  did  not. 

Q  Did  anyone  else  participate  in  this  discussion? 

A  Maybe  Dan  Kuykendall.  I  don't  know  whether  Frank 
ever  participated  in  them  or  not.  I  don't  remember  whether 
he  >as  ever  present. 

Q    Did  you  ever  receive  any  information  from  any 
source  indicating  that  Mr.  Channell  ever  made  a  copy  of  this 
report  available  to  any  Member  of  Congress? 

A    No. 

Q    Did  you  ever  receive  any  information  from  any 
source  that  Mr.  Channell  ev«r  made  this  regogt^vaj^laillfi  to 
any  Congressional  staff  member? 


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A     No. 

Q    Mr.  Miller,  in  the  prior  sessions  we  have  discussed 
the  consulting  arrangement  that  you  firm  entered  into  with 
David  Fischer  and  Martin  Artiano,  and  I  believe  it  was  agreed 
that  that  arrangement  was  originally  entered  into  in  December 
of  1985? 

A    Correct . 

Q    Did  you  consult  with  Oliver  North  about  retaining 
David  Fischer  or  Martin  Artiano? 

A    No.   In  fact  I  don't  even  think  they  were  aware  of 
it  until  late  in  '86. 

Q    When  you  say  "they  were  aware  of  it,"  who  are  you 
referring  to? 

A    I  mean  he  was  not  aware  of  it. 

Q    It's  your  understanding  that  Colonel  North  was  not 
aware  that  you  had  retained  Fischer  and  Artiano  until  late 
1986? 

.  A    Yes.   I  don't  think  he  understood  that  until  I  told 
hia  that,  and  I  don't  think  that  was  until  some  time  in  at 
least  the  middle  of  '86. 

Q    Did  you  discuss  with  anyone  in  the  White  House  the 
retention  of  Mr.  Fischer  and  Mr.  Artiano? 

A    I  don't  recall  discussing  it  with  anybody. 
Q    Do  you  know  if  Colonel  North  had  ever  met  David 
Fischer  prior  to  December  of  1985? 


ONClASSinED 


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A    I  really  don't.   I've  never  fiSSW  either  one  of 
them  say  either  way. 

Q    Do  you  know  if  Colonel  North  had  met  Martin  Artiano 
prior  to  December  of  1985? 

A    I'm  not  sure — no,  no. 

Q    Do  you  recall  a  $50,000  payment  that  was  made  to 
Mr.  Artiano  in  January  or  February  of  1986? 

A     I  recall  payments  to  him,  without  looking  at  the 
records,  if  you  say  there  was  a  $50,000  payment  in  January, 
I'm  sure  there  was. 

Q    We'll  get  to  the  records  in  a  minute,  but  do  you 
have  an  independent  recollection  of  a  $50,000  payment  in 
early  1986? 

A    I  remember  making  a  $50,000  payment  to  Mr.  Artiano. 

Q    And  was  there  a  later  $50,000  payment  to  Mr. 
Fischer? 

A 
-   Q 

A 

Q 


There  may  well  have  been. 

Do  you  recall  that? 

Not  specifically,  but  there  may  have  been. 

You  do  specif ically  recall  a  $50,000  payment  to  Mr. 
Artiano  early  in  1986? 

A    Well,  if  you  would  like  to  put  the  records  in  front 
of  me,  I'll  look  at  them.   I  don't  specifically  remember  a 
$50,000  transfer  to  Mr.  Fischer,  but  if  you  say  one_Jiappened , 
I'll  simply  take  your  word  for  it 


UNCUSSIFIED 


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UNCLASSIHED 


433 


Q  ,  Well,  my  last  question  related  to  the  payment  to  - 
Mr.  Artiano,  which  I  thought  you  said,  in  a  prior  answer,  you 
did  recall  a  payment  to  Mr.  Artiano. 

A    I  recall  a  payment  to  Mr.  Artiano  for  $50,000. 

Q    What  was  the  purpose  of  that  payment? 

A    It  was  a  cash  call  by  Mr.  Artiano  on  our  agreed 
arrangement  and  he  could  have  made  it  for  $70,000  if  he  had 
wanted  to,  but  $50,000  was  the  figure  he  wanted  and  needed. 

Q    "What  do  you  mean  by  a  cash  call? 

A    They  had  the  right,  under  the  contract  that  we  had 
with  them,  to  require  the  payment  in  whatever  tiaachtj-^they 
wished  and  sometimes  it  was  $10,000,  sometimes  it  was 
$20,000,  sometimes  it  was  larger. 

Q    Under  your  understanding  of  the  contract,  they 
could  have  called  for  the  full  payment  under  the  contract  in 
January  of  19867 

A    No,  I  don't  think  1  would  have  allowed  that.   There 
was.  a  lot  of  work  yet  to  be  done  under  the  contract.   I 
certainly  wouldn't  have  allowed  them  to  call  the  whole 
contract  before  they'd  finished  the  work  on  it. 

Q    But  $50,000  was  within  range,  in  your  view? 
Yes. 

Did  you  understand  that  to  be  an  advance? 
No,  I  didn't  consider  it  an  advance. 


What's  the  difference  between  a  cash  call  and  an 

"MOi  ACOinrn 


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advance? 

A    I've  never  made  a  distinction  between  the  two.   The 
only  thing  I  use  the  word  cash  call  in  that  they  were  allowed 
to  decide  the  amounts  that  were  to  come  to  them,  within 
reason,  and  that's  just  an  informal  term  on  my  part,  cash 
call. 

Q    Did  you  make  payments  to  Mr.  Fischer  in  1987? 

A     Yes. 

Q    Do  you  recall  the  amounts? 

A    $70,000  and  $35,000,  I  believe. 

Q    And  do  you  recall  the  months  that  those  payments 
were  made? 

A    No,  I  don't  recall  if  off  the  top  of  my  head. 

Q    Was  it  early  in  1987?   January  or  February? 

A    I  think  it  went  over  a  couple  of  months  and  that 
may  be  the  case  but,  without  looking  at  the  records,  I  don't 
remember  the  specific  dates. 

.  Q    What  was  the  reason  that  you  paid  Mr.  Fischer 
$105,000  in  1987? 

A    That  was  the  amount  that  was  remaining  on  our 
original  agreement  and  he  asked  for  it  and  so  I  paid  it  to 
him. 

Q    Did  you  make  any  payments  to  Mr.  Artiano  in  1987? 


Yes. 


How  much? 


INCUSSIHED 


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A     I  can't  remember  off  the  top  of  my  head  but  they 
were  in  $10,000  or  $5,000  increments. 

Q    What  was  the  reason  for  those  payments? 

A    That  was  additional  consultation  on  the  part  of — 
the  $5,000  was  additional  consultation  on  the  part  of  Mr. 
Artiano  for  business  development. 

Q    In  1987? 

A    Yes. 

Q    'What  subjects  did  you  consult  with  Mr.  Artiano 
about  in  1987? 

A    Well,  we  tried  to  keep  him,  generally,  aware  of  the 
business  opportunities  we  had  and  we  sought  his  counsel  and 
advice  and  when  possible,  we  tried  to  involve  him  in  our 
decisions  to  get  clients.   That  was  business  development. 

Q    At  some  point,  did  you  stop  using  Mr.  Artiano 's 
services  in  1987? 

A    Yes. 
.  Q    When  was  that? 

A    I  can't  recall  specifically  what  date  it  was. 

Q    Why  did  you  stop? 

A    We  just  had  no  more  use  for  it. 

Q    Did  Mr.  Fischer  perform  any  services  for  you  in 


1987? 


Oh,  yes. 

What  did  he  do? 


NOLASSiRED 


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Wuhmron.  D  C     ZOOOI 


ifimim 


436 


A    Well,  he  generally  served  as  a  partner  in  the  firm, 
provided  the  same  kind  of  workload  that  the  rest  of  us  did. 
Q    And  was  the  $105,000  his  total  compensation  from 
you  in  1987? 
A    No. 

Q    What  else  did  you  pay  him? 

A    Again,  off  the  top  of  my  head,  without  the  records 
in  front  of  me,  I  can't  remember  a  specific  number  but  we 
made  several  payments  or  received,  from  him,  payments  which 
represented  a  net  sum  from  the  client.   In  other  words,  a     i 
client  would  pay  his  corporation  and  his  corporation  would 
then  transfer  IBC's  share  to  IBC.  J 

Q    But  the  $105,000  was  compensation  to  Mr.  Fischer  and| 
in  return  for  that  compensation,  he  has  been  providing 
services  for  you  during  1987? 

MR.  PRECUP:   Excuse  me.   I  don't  believe  that  was 
the  witness's  prior  testimony. 
THE  WITNESS:   No. 

MR.  PRECUP:   He  did  characterize  that  $105,000 
payment,  but  not  as  compensation  for  current  services. 

THE  WITNESS:   That  was  the  remaining  amount — 
$105,000  was  the  remaining  amount  due  to  Mr.  Fischer  for  our 
original  contract  on  the  NEPL  ac^ivities^ 
BY  MR.  FRYMAN 

Q    And  this  was  the  agreement  that  you  reached  in 

I 


lEPL  activities. 

UNCUSSIFIED 


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■HJJM  NtronriNo  CO..  MC 
JOICSiiKt.  NE  25 

Vuhin|<ixi.  O  C      :0002 


ii^SSIFIED 


437 


December  of  1985?  ! 

I 

I 

A    Correct.  | 

I 
Q    And  what  period  of  time  was  that  agreement  to  cover?! 

A    It  was  for  six  months  and  it  was  agreed  that  it  was  | 
representative  of  24  months  of  $20,000  a  month. 

Q    So  the  agreement  was  for  24  months? 

A    That's  correct.   Two  years. 

Q    And  that  would  continue  until  December  of  19877 

A    That's  correct,  but  they  had  the  right  to  make  cash 
calls  along  the  way,  within  reason. 

Q    But  you  had  the  right  to  call  on  Mr.  Fischer's 
seri^ices  until  December  of  1987  for  the  $280,000  you  were 
going  to  pay  him--or  the  $480,000,  correct? 

A    No.   By  1987,  we  were  involved  in  other  efforts 
already.   As  I  said,  the  $105,000  was  paid  for  past  activities 
for  NEPL  and  the  compensation  that  you  are  asking  me  about 
now  in  1987  was  for  other  business  unassociated  with  NEPL. 

.  Q    Well,  Mr.  Miller,  as  I  understand  your  testimony, 
you  reached  an  agreement  with  Mr.  Fischer  that  he  was  to 
provide  services  for  24  months,  is  that  correct? 

A    No.   The  financial  commitment  from  us  was  for  2  4 
months  worth  of  $20,000  a  month. 

Q    And  that's  unrelated  to  his  doing  any  work  for  24 
months? 

A    No.   Ms.i^bacaeL  acd^LBCji^aulred  a  large  workload 


iiKrf«nit«t»Ktrm 


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507  C  Strtt..  N  E  2  5 

VuJunfton.  D  C      20002 
(202)  M6-6M4 


UNCUSSIFIED 


438 


by  Mr.  Artiano  and  Mr.  Fischer  in  the  first  seven  months,  but 
initially,  that  first  six  months  of  1986  there  was  a  tremen- 
dous workload  and  the  commitment  that  we  were  required  to 
make  to  Mr.  Artiano  and  Mr.  Fischer,  was  for  two  years  at 
$2  0,000  a  month. 

Q    So,  am  I  correct  in  understanding  your  testimony 
that  you  are  saying  that  in  effect,  Mr.  Fischer  had  completed 
his  24  months  of  work  by  January  of  1987? 

A    ,Yes.   You  keep  interjecting  the  word  work,  when  I'm 
talking  about  compensation. 

Q    Are  the  two  unrelated  in  your  mind? 

A    The  two  are  unrelated  in  terms  of  my  financial 
commitment  to  Mr.  Fischer,  which  is  what  you're  asking  me 
about . 

Q    So  you  made  a  financial  commitment  to  him  that  was 
unrelated  to  his  performing  any  services  for  you,  is  that 
what  you're  saying? 

A    No. 

MR.  PRECUP:   Mr.  Fryman,  that  isn't  what  he  said. 
Don't  misfcharacterize  his  testimony. 

MR.  FRYMAN:   Well,  I'm  trying  to  understand  his 
testimony,  Mr.  Precup,  and  I'm  finding  it  somewhat  difficult 
to  understand  it. 

BY  MR.  FRYMAM: 

Q  Now,    I'ji  Just   tJ^Yinfl  to^_g®t   clear.      As    I    understand   | 


JO^II^I  KWffin 


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UNCUSSIFIED 


439 


it,  you  reached  an  agreement  with  Mr.  Fischer  in  December  of 
1985,  to  cover  a  period  of  24  months. 

A    A  financial  commitment  to  Mr.  Fischer  and  Mr. 
Artiano  for  $20,000  a  month  for  24  months.   That's  correct. 

Q    Or  a  total  of  $480,000? 

A    That's  correct. 

Q    Now,  were  they  to  provide  services  for  that  amount 
of  money? 

A    Yes  and  they  did. 

Q    Were  those  services  to  cover  any  particular  period 
of  time? 

A    About  six  months  worth  of  intense  activity,  yes. 

Q    So  they  were  to  be  paid  $480,000  for  six  months  of 
work,  is  that  what  you're  saying? 

A    That's  correct. 

Q    And  that  six  months'  work  had  been  completed  by 
January  of  19877 

A    That's  correct. 

Q    And  when  you  paid  him  $105,000,  you  in  effect,  were 
paying  him  for  services  that  he  had  already  rendered? 

A    That's  correct. 

Q    Okay.   So  Mr.  Fischer  and  Mr.  Artiano  were,  in 
effect,  being  compensated  a  total  of  $480,000  for  six  months 
work,  or  $80,000  a  month? 

A    I  don't  accept  it.   What  was  required  of  me. 


t  accept  it.   What  was  r« 

IIMOI  Kcoicicn 


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12021  M6-MM 


because  we  were  monopolizing.,  particularly,  Mr.  Fischer's 
time  for  that  seven  months,  but  predominantly  six  months  in 
early  1986,  was  a  commitment  to  them  for  24  months,  $20,000  a 
month.   It  was  not  financially  possible  to  make  that  commit- 
ment without  passing  it  along  to  the  client  that  required  the 
work. 

Q    Mr.  Miller,  as  I  understand  what  you  have  said,  you 
made  a  commitment  to  pay  Mr.  Fischer  and  Mr.  Artiano  $480,000. 

A    That's  correct. 

Q    And  you  understood  that  they  had  performed  the 
services,  under  that  agreement,  within  a  period  of  six  months? 

A    Yes. 

Q    And  you  owed  them  $480,000  for  six  months'  work? 

A    That's  correct. 

Q    And  according  to  my  arithmetic,  that  works  out  to 
$80,000  a  month. 

A    Well,  that's  your  arithmetic. 

Q    Do  you  disagree  with  the  arithmetic? 

A    I've  already  told  ycu  I  disagree  with  it.   What  I 
made  to  them  was  a  commitment  for  $20,000  a  month  for  24 
months .   And  that  was  the  substance  of  the  commitment  to 
them.   Now,  you  can  divide  it  up  any  way  you  want,  but  that 
was  my  commitment  to  them. 

Q    Just  to  make  sure  you  and  I  are  on  the  same  wave 
length  about  the  elements  in  the  equation,  the  total  amount 


elements  in  the  equation 

iiMPi  Accifirn 


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ONCLASSIRED 


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of  funds  is  $480,000? 
A    Correct. 

Q    And  the  total  months  of  service  was  six  months? 
A    That's  correct  also. 

Q    And  in  addition  to  the  $480,000  commitment,  you  had 
a  separate  arrangement  with  Mr.  Artiano  for  him  to  provide 
additional  services  directly  for  IBC,  I  believe  you  testified. 
A    Correct. 

Q   , And  you  had  separate  financial  arrangements  with 
Mr.  Fischer,  with  regard  to  additional  services. 
A    That's  correct  also. 
Q    Off  the  record. 

[Brief  pause  off  the  record.] 

MR.  FRYMAN:   All  right,  we  will  start  with  Exhibit 
29  and  see  what  happens.   It  appears  from  the  prior  transcript 
of  Mr.  Miller's  deposition,  that  the  last  exhibit  marked  was 
Number  28.   I  would  ask  the  reporter  then  to  mark,  as  Miller 
Deposition  Exhibit  29  for  identification,  a  report  that  has 
b««n  prepared  by  accountants  for  the  House  and  Senate 
Committees,  which  summarizes  financial  data  and  bank  records 
of  International  Business  Communications,  INTEL  Corporation, 
Gomez  International,  Miller  Communications,  and  World  Affairs 
Counselors,  Inc.   This  report  is  dated  September  14,  1987  and 

contains  35  pages 
f  '  '  ^  '•■* 

i 

b 


I  35  pages.  

ililASSinEI^ 


he  documents  referred  to  were 


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WuhLnftor   D  C     JOOOJ 


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marked  for  identification  as 
Miller  Deposition  Exhibit  No. 
29.  ) 
BY  MR.  FRYMAN: 
Q     Mr.  Miller,  I  show  you  Exhibit  29  for  identifica- 
tion.  You  will  notice  that  the  first  sheet  is  headed 
Analysis  3-A,  which  is  a  summary  sheet  of  the  statement  of 
cash  receipts  and  disbursements  for  the  period  January  1985 
to  Decembet  1986.   The  next  sheet  is  a  similar  summary  sheet 
which  is  headed  Analysis  3-C,  which  is  an  analysis  of 
disbursements  to  other  organizations  for  the  same  period. 
There  is  no  sheet  headed  Analysis  3-B,  you  will  note.   The 
third  sheet  is  headed  Analysis  3-D  and  is  an  analysis  of 
receipts  for  the  IBC-af filiated  companies  for  the  same  period. 
Then  following  that  there  are  further  sheets,  three 
summary  sheets  relating  to  the  IBC  account,  one  summary  sheet 
relating  to  the  IC  account,  one  summary  sheet  relating  to 
Midler  Communications,  and  one  summary  sheet  relating  to 
Gomez  International.   Following  those  summary  sheets  are  then 
a  number  of  detailed  sheets  listing  the  components  of  the 
various  accounts  that  are  summarized  on  the  prior  sheets. 
Now,  let's  go  off  the  record  for  a  second. 


[Brief  pause  off  the_reco^rd^  ] 
5  "  " 


illiiSSflE 


BY  MR.  FRYMAN: 
Q    Mr.  Miller,  if  you  would  first  turn  in  Exhibit  29 


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XI?  C  Sum.  N  E  2  5 

Wuhinina.  D  C      :00C< 


yriCUSSIFIED 


443 


to  page  10,  you  will  notice,  on  that  page,  toward  the  bottom, 
the  report  indicates  that  there  were  payments  to  IBC  of 
$22,500  from  an  entity  called  ESOP  Associates.   Are  you 
familiar  with  ESOP  Associates? 

MR.  PRECUP:   Before  the  witness  answers,  Mr. 
Fryman,  I  want  to  say  for  the  record  that  we  object  to  the 
use  of  this  exhibit  for  questioning  the  witness  on  a  wide 
number  of  bases.   The  document  appears,  in  its  35  pages  here, 
to  be  other  than  complete  in  that,  for  example,  it  has  • 
analyses  3-A,  C  and  D,  but  no  3-B,  not  to  mention  1  and  2, 
whatever  they  might  be.   It  is  impossible,  on  a  brief 
examination,  to  deteonnine  whether  this  is  a  correct  and 
complete  analysis,  let  alone  an  accurate  one  of  the  accounts 
it  purports  to  review. 

It  contains  characterizations  throughout  of  payee's 
sources  of  funds  and  the  like.   He,  of  course,  assume  that 
the  math  is  correct,  but  that's  an  assumption  because  we  have 
not.  had  a  chance  to  check  it  ourselves.   We  don't  know  what 
records  in  total  were  used  to  produce  this  nor  what  biases 
existed  in  the  persons  who  did  produce  it  and  who  are  not 
here  for  us  to  question. 

Hence,  we  do  not — the  witness  does  not  adopt  any 
part  of  this  exhibit  as  a  true  description  of  any  kind  of 
reality.   With  all  that  said,  should  anything  you  care  to 
point  out  to  him  in  this  document  refreshes  recollection 

\\m\  Acoinrn 


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>07  C  Sam,  N  E  25 

Vuhinfuo.  0  C      20002 


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444 


pendently,  about  a  transaction  or  an  event,  I,  of  course, 
have  no  objection  to  the  witness  answering  that  question. 
MR.  FRYMAN:   Mr.  Precup,  as  I  indicated  when  I 
marked  the  document  as  an  exhibit,  I'm  not  asking  Mr.  Miller 
to  adopt  this  analysis  as  being  in  its  entirety  correct.   I'm 
merely  marking  it  as  an  exhibit.   I'm  representing  that  it  is 
the  analysis  prepared  by  our  accountants  and  I  intend  to  use 
it  as  a  basis  for  putting  specific  questions  to  Mr.  Miller. 
BY  MR.  FRYMAN; 

Q    The  pending  question,  Mr.  Miller,  is  derived  from 
page  10,  but  I  can  really  ask  you  the  question  independently 
of  page  10.   Are  you  aware  that  IBC  received  funds  from  an 
entity  called  ESOP  Associates? 

A    Yes. 

Q    What  is  that  entity? 

A  It's  actually  called  the  ESOP  Association  and  it's 
the  employee  stock  ownership  program  association  in  Washing- 
toa« 

Q    And  were  they  a  client  of  IBC? 

A    Yes. 

Q    Do  you  recall  if,  in  1985,  they  paid  fees  to  your 
organization  in  the  range  of  $22,500? 

A    We  were  paid  $22,500  for  the  execution  of  a  general 
public -affairs  program.   Some  of  that  was  fees;  some  of  that 
was  program  expenditures.   As  I  recall,  we  refunded  about 

iiMPi  aooini'n 


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HUjn  NVOnTMO  CO..  MC 

)or  CSttCTt.  N  E  25 

Vuhinftoo.  DC      20002 


(iNwssire 


445 


$12,SO0  to  them.   I  think  that's  correct..  I  can't  remember 
the  figures  specifically. 

Q     If  you  would  look  at  page  18,  Mr.  Miller,  you  will 
notice  that  there  is  reflected  there  a  payment  by  IBC  to  ESOP 
Associates  of  $13,690.   Is  that  amount  consistent  with  your 
recollection  of  the  amount  that  was  paid  back  to  that  client? 

A    We  only  made  one  payment  to  ESOP  so  that  would  have 
to  be  it  if  that's  an  accurate  reflection  of  my  business 
records.  ' 

Q    Was  the  payment  that  you  made  back  to  them  approxi- 
mately in  November  of  1985,  according  to  your  recollection? 

A    Yes. 

Q    Am  I  correct  in  understanding  that  the  fees  that 
you  received  from  this  client  had  nothing  to  do  with  your 
work  in  connection  with  the  Nicaraguan  Resistance? 

A    That's  correct. 

Q    If  you  would  look  again  at  page  10,  there's  a 
reference  to  Calero  traveler's  checks  and  there's  a  number  of 
entries  indicating  that  in  April  of  1985,  you  received 
$35,000  from  Mr.  Calero.   Is  that  consistent  with  your 
recollection  that  you  received  that  amount  of  money  from  Mr. 
Calero  in  April  of  1985? 

MR.  PRECUP:   Excuse  me,  Mr.  Fryman.   You  said 
$35,000.   Perhaps  you  misspoke^  Our_sheet  shows  a  different 
figure . 


s  you  misspoke.   Our  sheet 

ONCUSSIFIEff 


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wum  wroitTaMi  co..  mc. 
MTCSOKI.  NE.  23 

.  DC     2000] 


UNCUSSIFIED 


446 


MR.  FRYMAN^   In  April  of  1985,  I  believe  it's 
$35,000,  Mr.  Precup. 

MR.  PRECUP:   You're  selecting  just  the  April 
figures  from  that? 

MR.  FRYMAN:   That's  right.   There's  a  $4,000  figure 
in  February  of  1985. 

MR.  PRECUP:   All  right,  we  see.   Thank  you. 
THE  WITNESS:   I  recall  receiving  traveler's  checks 
from  Mr.  Galero.   Without  looking  at  my  business  records,  I 
can't  attest  to  whether  your  dates  are  correct  or  the  amounts 
are  correct,  but  I  was  paid  by  Mr.  Calero  in  traveler's 
cheeks . 

J'^  MR.  FRYMAN: 
Q    Was  it  a  series  of  payments  in  traveler's  checks  in 
April  of  1985? 

A    Well,  there  was  a — yes,  for  different  things  and 
there  were  several  payments  in  April  of  1985 . 

Q    Is  it  your  recollection  that  those  payments  were  in 
the  range  of  $35,000? 

A    I  don't  have  a  specific  recollection  of  the  range, 
but  I  do  recall  a  $20,000  wire  transfer  and  $10,000  in 
traveler's  checks  specifically. 

Q    What  did  you  do  with  the  traveler's  checks? 
A    I  think  most  of  them  were  deposited  into  the 
general  IBC  account  and  I  think  some  of  them  I  took  directly 


453 


clg447 


MT  C  iORi.  N  I. 
Wiifafi|coa.  O  C. 
(m)t44-6«M 


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FIED 


and  I've  forgotten  the  exact  amount. 
0    Took  directly  where? 

A    I  used  them  for  my  own  personal  income.   It  was  a 
sole  proprietorship  in  1985. 

Q    All  right.   If  you  turn  to  page  11,  Mr.  Miller,  the 
exhibit  indicates  that  IBC  received  approximately  $14,000  in 
1985  from  the  Gulf  and  Caribbean  Foundation.   Do  you  recall 
your  company  receiving  payments  from  the  Gulf  and  Caribbean 
Foundation? 

A    Yes. 

Q    Did  your  company  perform  services  for  the  Gulf  and 
Caribbean  Foundation? 

A    Yes. 

Q    What  was  the  nature  of  the  services? 

A  We  were  their  media-^relations  and  foreign,.policy 
advises  for  their  scholars  program  and  their  other  public 
education  efforts. 

.  Q    Did  you  understand  that  Dan  Kuykendall  supervised 
the  operations  of  the  Gulf  and  Caribbean  Foundation? 

A    Yes. 

Q         Did  you  ever  discuss  the  Gulf  and  Caribbean 
Foundation  with  Oliver  North? 

A    I'm  sure  I  did  at  one  point  or  another. 

Q    Do  you  recall  any  discussion? 

A  {{jli  ^^tfV^afSf^S^^^'&^^E*^^^^^"'   ^  ^°   recall  that,  I 


454 


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muuu  MPOimMO  Co..  mc 

JOT  C  Sow.  N  E.  25 

WuhuiToa.  0  C     20002 
(202)  Mi-MM 


mn 


448 


think  the  first  time  that  Colonel. North  asked  me  for  money, 
the  money  that  was  eventually  transferred  to  Mr.  Robelo's 
account — I  actually  think  Colonel  North  thought  I  was  going 
to  go  to  the  Gulf  and  Caribbean  sponsors,  as  opposed  to  Mr. 
Channel,  but  that's  only  a  sum  total  recollection.   It's  not 
a  specific  recollection. 

Q    You  are  familiar,  of  course,  with  the  chart 
prepared  by  Colonel  North  that  was  printed  in  the  Tower 
Commissioo  report  and  has  been  marked  earlier  as  an  exhibit 
in  this  deposition. 

A    I  was  provided  a  copy  of  it  by  your  Committee  and 
I've  had  a  chance  to  review  it. 

Q    You've  seen  it  before? 

A    Yes. 

Q    And  you're  aware  that  there's  a  box  on  that  chart 
that  indicates  the  GNC  Foundation? 

A    Yes. 

Q     Do  you  have  any  information  as  to  why  Colonel  North 
included  what  appears  to  be  a  reference  to  the  Gulf  and 
Caribbean  Foundation  on  that  chart? 

A    No. 

Q    Do  you  believe  that  any  discussion  you  had  with 

Colonel  North  could  have  been  the  basis  for  his  including 

that  reference  on  the  chart? 

A    It's  entirely  possible  but  I  don't  have  any 
f  >  «V ! 


''^m  ^^Pinrn 


455 


r.  N.L 

.  DC  »cei 


OhCLASSIRED 


449 


specific  recollections  of  a  conversation  either  about  the 
chart  or  including  them  in  some  formal  structure. 

Q    Also  on  page  11,  Mr.  Miller,  there's  an  indication 
that  IBC  received  $9,800  from  Kate  Macinnis.   Now,  was  Kate 
Macinnis  a  secretary  at  your  organization? 

A    No.   Kate  Macinnis  is  our  office  manager. 

Q    She  was  an  office  manager.   Is  it  your  recollection 
that  there  was  a  financial  entry  in  your  books  showing 
receipt  of  $9,800  from  Kate  Macinnis? 

A    No. 

Q    Do  you  have  any  explanation  for  such  an  entry? 

A    Without  going  back  to  my  books  and  specific  detail, 
no.   I  think  it's  an  error  in  your  document. 

Q  Mr.  Miller.  Turn  to  page  32.  On  that  page,  the 
report  indicates  payments  by  Miller  Communications  to  Kate 
Macinnis  in  February  through  May  of  1986  totaling  $35,863. 
Do  you  recall  such  transfers  from  Miller  Communications  to 
Kate  Macinnis? 

A    No.  Again,  I  think  it  is  an  error  in  your  report. 
There  is  simply  the  name  on  the  check.   I  think  they  are 
probably  either  my  draw  or  travel  advance,  and  she  simply 
cashed  the  check. 

Q    There  is  a  particular  entry  dated  March  24,  1986  for 
$31,663,  and  there  is  a  notation  NBW.   Do  you  recall  a 
transfer  to  her  in  that  approximdtfi -Smount  in  March  of  1986? 


ar  in  that  approximate  amc 

mm  Rccinttr 


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■ujii  RvomMo  eo„  Mc 

507  C  Sam.  N  E  2  5 

Vuhinjma.  O  C     20001 
(202) 


umKsffl 


450 


A.    No.   Again,  it  wasn't. a  transfer  to  her.   That  is 
simply  her  cashing  a  check  in  order  to  write  either  a 
cashier's  check  or  a  treasurer's  check  to  myself. 

Q    You  believe  it  was  one  of  the  two. 

A    Yes. 

Q    Do  you  recall — 

A    It  may  have  been  Kenneth,  but  I  don't  ever  remember 
carrying  $31,000  in  cash  away  from  the  office,  so  I  suspect 
it  was  probably  a  treasurer's  or  a  cashier's  check. 

Q  Do  you  recall  placing  an  order  for  a  cashier's 
check  or  a  treasurer's  check  in  the  amount  of  $31,663  in 
March  of  1986? 

A    Not  specifically,  but  I  can  check  my  records.   I 
don't  specifically  recall  it. 

Q     If  you  turn  to  page  17,  Mr.  Miller,  on  that  page 
you  will  note  that  the  report  indicates  that  there  were  IBC 
checks  to  Cash  in  March  of  1986:   a  check,  March  21,  for 
$2(1,005;  a  check,  March  26,  of  $20,005,  and  a  check  in  April, 
April  15,  for  $20,010.   Do  you  recall  IBC  making  such  cash 
withdrawals  in  March  and  April  of  1986? 

A    Not  specifically,  but  I  am  also  not  accepting  your 

assertion  that  these  are  cash  withdrawals .   These  may  have 

n 
been  interf account  transfers  or  the  purchase  of  treasurer's 

checks  or  cashier's  checks.. 

Q    All  jrj.<yhtj  ."^.yg^^'^gStfJ-iLflPy  purchase  of  treasurer's 


»llW[rtl:li' 


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■uiN  NDOirnMO  CO.,  mc 

507  C  Stren.  N  E  25 

VuhintKM.  O  C     20002 
(202)  HH6U 


iSi 


uissife 


451 


checks  or  cashier's  checks  in  those  amounts  in  March- and 
April  of  1986? 

A    None  in  specific,  no. 

Q    Now,  in  response  to  my  question  about  Kate  Macinnis 
and  about  these  transactions,  you  have  referred,  on  both 
occasions,  to  the  possibility  of  treasurer's  or  cashier's 
checks  in  amounts  of  $20,000  or  $30,000.   Do  you  recall  that 
you  obtained  cashier's  checks  or  traveler's  checks  in  that 
approximate  amount  at  that  time? 

A    I  never  said  traveler's  checks.   I  said  treasurer's 
checks . 

Q    I'm  sorry,  treasurer's  checks  or  cashier's  checks. 

A  Again,  I  don't  in  specific  detail,  but  that's 
entirely  possible  that  it  either  was  that  or  these  were 
inter+account  transfers. 

Q    Well,  you  say  that's  entirely  possible.   Do  you 
recall  making  transfers  in  the  range  of  $20,000-$30,000  by 
cashier's  checks  and  treasurer's  checks? 

A    I  recall  transfers  in  the  amount  of  $20,000.   How 
the  specific  transactions  were  handled,  I  can't  remember 
specifically  without  looking  at  my  records. 

Q    So  you  have  no  recollection  of  withdrawals  in  the 
March  and  April  1986  period  that  total  approximately  $100,000 
in  four  transactions,  three  transactions  reflected  on  page  17 
for  $20,000  each  payable  to  Cash  and  the  other  transaction 


each  payable  to  Cash  and  t 


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m  I  fW  NVOMTWQ  CO^  MC 
J07  C  Sum.  N  E  25 

Vuhmcna.  D  C     20002 


11 


452 


from  Miller  Conununications  of  $30,000  on  March  24,  payable  to 
Kate  Macinnis? 

Q    Well,  in  keeping  with  what  my  counsel  said  earlier 
and  to  reflect  my  answer  a  moment  ago,  I  remember  $20,000 
transfers.   I  can't,  from  your  document — I  do  not  have,  from 
your  document,  a  specific  refreshment  of  my  recollection 
about  these  individual  transfers. 

Q    What  $20,000  transfers  do  you  recall? 

A    No,  I  simply  remember  making  $20,000  transfers'. 

Q    To  whom? 

A    I  don't  remember  specifically  whom  and  I  couldn't 
remember  them  off  the  top  of  my  head  without  looking  at  my 
business  records.   Again,  they  may  have  been  inter-company 
transfers. 

Q    If  you  were  seeking  a  treasurer's  check  or  a 
cashier's  check  from  the  bank,  would  you  make  the  IBC  check 
payable  to  Cash? 

.A    It's  been  done  that  way,  yes. 

Q    Might  you  also  make  it  payable  to  Kate  Macinnis? 

A    I  might  make  it  payable  to  Kate  Macinnis .   I  might 
make  it  payable  to  the  National  Bank  of  Washington. 

Q    It  would  be  one  of  the  three? 

A    Right.   It  could  also  be  made  out  to  me  as  an 

individual  and  I  could  endorse  it  and  the  bank  would  accept 

the  endorsement .  J^  fro^lfii,  f4^f(f^4~knie  out  as  a  corporation 


n?#Ct«Jt^'^' 


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wtun  mrormta  co.,  mc. 

JO?  C  Siren.  N  E  25 

Vajhinpon.  O  C.    20002 


IlLASSIFIED 


453 


with  the -bank  accepting  the  endorsement  of  the  corporation. 

Q    If  you  would  turn  to  page  13,  the  exhibit  indicates 
transfers  to  IBC  totalling  $15,000  from  the  Institute  for 
North  South  Issues.   Do  you  recall  IBC  receiving  payments 
from  the  Institute  for  North  South  Issues? 

A    Yes. 

Q    What  was  the  purpose  of  those  payments? 

A    We  were  paid  a  monthly  rent  for  the  office  space, 
use  of  the  telephones,  and  other  facilities,  xeroxing, 
receptionist  by  the  Institute  of  $15,000  a  month.   I  think  if 
you  look  at — 

Q    You  said  $15,000  a  month. 

A    $1,500  a  month,  I'm  sorry.   $1,500  a  month. 

Q    Is  it  your  recollection  that  you  received  total 
payments  of  approximately  $15,000  for  such  rent  and  overhead? 

A    Well,  I  specifically  remember  getting  $1,500  a 
month  from  them.   These  figures  are  all  in  $1,500  increments, 
so _I  would  assume  these  are  all  rent  payments.   I  don't 
believe  we've  ever  received  anything  but  rent  payments  from 
them. 

Q    You  don't  recall  ever  receiving  a  fee  of  any  sort 
from  the  Institute  for  North  South  Issues? 

A    No. 

Q    Okay.   Also  on  that  page,  there's  an  indication  of 
a  transfer  of  funds  from  Ransom  F.  Shoup  and  the  company, 


460 


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vn  c  imt%.  N  E.  2  5 

IfiiuaimB.  D  C.    20002 


KUSSiFIED 


454 


payments  totalling  $15,170.   Is  that  a  client  of  your  firm?   I 

A    Yes .  j 

Q     Has  your  firm  performed  public'relations  services    | 
for  that  client? 

A    Yes. 

Q    Are  those  payments  unrelated  to  your  work  in 
connection  with  the  Nicaraguan  Resistance? 

A    Yes. 

Q   '  Turning  to  page  14,  Mr.  Miller,  there's  an  account 
that  begins  on  the  preceding  page,  13,  where  our  accountants 
have  not  been  able  to  identify  the  source  of  funds  to  IBC  and 
I  want  to  ask  you  about  certain  entries  on  there  and  just  ask 
you  if  you  recall  what  the  source  of  the  funds  were.   In 
particular,  there's  a  reference  to  a  payment  on  September  25, 
1985  of  $16,340.   Do  you  recall  receiving  a  payment  in 
approximately  that  amount  at  that  time? 

A    Yes. 

Q    What  was  the  source  of  those  funds? 

A  I  believe,  again  from  just  trying  to  recollect  from 
your  document  refreshing  my  memory  that  that  was  a  payment  by 
the  Indonesian  World  Trade  Center. 

Q    Did  any  such  payment  have  any  connection  with  your 
work  for  the  Nicaraguan  Resistance?! 

A     No.  i?nl?Lnuu 

Q    Also  on  that  page,  Mr.  Miller,  there's  an  entry  for 


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■UBI  MNHTMO  CO,  at 
W7  C  Jam.  N  E.  25 


fflUiS«B 


455 


a  payment  on  March  3/  1986  of  $7,000.   Do  you  recall  a 
payment  in  that  amount  at  that  time? 

A    Not  specifically. 

Q    You  will  also  note  a  payment  on  June  11,  1986  of 
$25,000.   Do  you  recall  a  $25,000  payment  in  June  of  1986? 

A    Not  specifically. 

Q    When  you  say  not  specifically — 

A    I  have  no  recollection  of  that  without  going  back 
to  my  business  records. 

Q    Further  down,  there's  an  entry  for  a  payment  of 
$10,000  on  September  29,  1986.   Do  you  recall  a  payment  of 
that  amount  at  that  time? 

A    No,  I  don't  recall  it. 

Q    There's  an  entry  for  a  payment  of  $8,500  on  October 
2,  1986.   Do  you  recall  a  payment  of  that  amount  at  that  time? 

A    NO. 

Q    There  is  an  entry  for  a  payment  of  $38,100  on 
November  10,  1986.   Do  you  recall  a  payment  of  that  amount  at 
approximately  that  time? 

A    I  think  it's  $30,100,  but  I  don't  recall  the 
specifics  of  that. 


Off  the  record. 


(Brief  pause  off  the 


BY  MR.    FRYMAN: 


SUSSIFIED 


In  any  case,  Mr.  Miller,  just  so  there's  no 


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HUJN  MFOKTWO  CO^  MC. 
W7  C  Sirm.  N  E.  25 

Vidmcns.  DC.    2000] 


ISUSSIFIM 


456 


confusion  over  this,  page  14  indicates  a  payment  of  $38,100   I 

i 
on  November  10,  1986.   Do  you  have  any  recollection  of  a      ! 

payment  in  that  approximate  amount  at  that  approximate  time?   I 

A     No.  ! 

MR.  PRECUP:   Mr.  Fryman,  I  would  observe  too  that   | 
the  word  payment  is  not  indicated  anywhere  on  the  face  of     | 
this  column.   It  shows  a  receipt,  but  whether  that's  a        j 
payment  or  some  other  transaction  is  not  specified  on  this 
sheet,  so  if  there's  some  other  information  that  you  h^ve 
that  indicates  it's  a  payment,  I  would  appreciate  you  telling 
the  witness  that. 

MR.  FRYMAN:   Well,  I'm  trying  to  be  as  nonj^echnical 
as  possible,  Mr.  Precup.   What  the  sheet  indicates  is  that 
IBC  received  funds  in  that  amount  at  approximately  that  date 
and  by  payment,  I  meant  a  payment  to  IBC. 
BY  MR.  FRYMAN: 

Q    Finally  on  this  page,  Mr.  Miller,  there's  an  entry 
of .a  receipt  of  $20,000  on  November  12,  1986.   Do  you  have 
any  recollection  of  the  receipt  of  approximately  that  amount 
at  that  time? 

A    I  think  in  that  period — no,  I  don't.   I'm  sorry.   I 
don't  have  a  specific  recollection.  I 

Q  Further  on  that  page,  there  are  entries  indicating  j 
payments  to  IBC,  or  receipts  by  IBC,  of  $356,471.66  from  the  j 
U.S.  Treasury.   Do  vpu  recall  receiving  such  monies  from  the  1 


lurv.   Do  you  recall  recei 


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U.S.   Treasury? 


Oi^CUSSinED 


A    Yea. 

Q    What  were  those  funds  for? 

A    These  are  in  relation  to  the  State  Department 
contracts . 

Q    There's  one  there  for  $14.50  on  October  24,  1985. 
Do  you  have  any  recollection  as  to  what  that  relates  to? 

A    I  don't  have  a  specific  recollection,  but  it  may 
well  be  a  refund  on  one  of  our  corporate  tax  returns. 

Q    But  I  take  it,  you  don't  believe  that  relates  to 
the  State  Department  contract? 

A    No,  I  don't  think  we  ever  got  a  check  that  small 
from  the  State  Department. 

Q    But  are  the  other  entries  in  that  column  consistent 
with  your  recollection  of  payments  to  IBC  from  the  State 
Department? 

A    All  but  the  first  one  and  I  would  have  to  verify 
that  from  my  business  records.   The  others  all  seem  consis- 
tent. 

Q    Tou  recall  a  series  of  payments  for  $12,858? 

A    That's  correct. 

Q    And  you  recall  a  large  payment  for  $216,381.16? 

A    Yes. 

Q    And  a  final  payment  of  $25,670? 

A    Correct . 


ONOUSSIRED 


464 


clg458 

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MUjBI  nVOMTMtt  CO^  MC 
WTCSfmt.  NE.  25 

Wuhioiraa.  O  C.    2000] 


WliSSW 


458 


Q    Turning  to  page  15,  there's  a  notation  that  your 
account  received  $6,761.55  in  December  of  1986  from  the 
Western  Goals  Foundation.   Do  you  recall  receiving  a  payment 
of  approximately  that  amount  at  that  time? 

A    Yes. 

Q    What  was  that  for? 

A    It  was  for  the  beginning  of  a  radio  program  they 
wanted  to  put  on  the  air. 

Q    And  Western  Goals  was  an  organization  controlled  by 
Mr.  Channel  at  that  time? 

A    Well,  he  was  involved  with  it  at  that  time. 
Whether  he  was  in  direct  control,  I  don't  know. 

Q    Did  you  consider  Mr.  Channel  the  individual  who 
made  the  decision  to  make  a  payment  to  you  on  behalf  of 
Western  Goals? 

A    In  conjunction  with  Mr.  Conrad  who  was,  at  that 
time,  I  believe  the  Executive  Director  of  Western  Goals. 

_  Q  There  are  also  on  that  page^  entries  indicating 
receipts  of  $20,000  from  William  Mulvey,  Inc.  Is  William 
Mulvey,  Inc.  a  client  of  your  firm? 

A    Yes. 


And  you've  rendered  public^relations  services  for 


^ 
that  client? 

A    And  other  services  as  well  J 

Q    And  am  I  correct  that  the  receipts  from  that  client 


D 


465 


clg459 

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m±n  iwowrwu  co-  —c 
wrcjom.  NE  25 

Wariuatna.  DC.    20002 


iJNCLASSW 


459 


had  nothing  to  do  with  your  work  for  the  Nicaraguan  Resis- 
tance? 

A    That's  correct. 

Q    On  that  page,  there  are  further  series  of  payments 
at  this  point,  beginning  after  the  first  two  entries,  which 
are  reflected  as  a  debit  column,  of  payments  to  1607  Asso- 
ciates and  1912  Sunderland  Associates.   Is  it  your  recollec- 
tion that  you  made  such  payments  to  such  entities  as  rent 
payments?  , 

A    Rent  and  other  services . 

Q    On  page  16,  Mr.  Miller,  there  are  also  a  series  of 
payments  reflected  to  Bragg  Communications  for  the  period 
June  1985  through  January  of  1986.   Is  it  your  recollection 
that  you  made  such  payments  to  Bragg  Communications  for  rent 
also? 

A    That's  correct. 

Q    Continuing  on  page  16,  there  is  an  indication  of  a 
payment  of  $10,000  in  November  1986  to  Frederick  Arguello 
from  the  IBC  account.   Do  you  recall  making  such  a  payment 
from  that  account  in  November  of  1986? 

A    It  was  money  that  was  transferred  to  him  at  the 
direction  of  Colonel  North. 

Q    Did  this  reflect  A'£<ls-fc<Jia|  ^AfSfifiifl4  *^°'"  ^' 
Channel  ,  organization?    0 ^J^l  AScIFIlD 

A    Yes.   I'm  not  sure  you  have  the  right  account,  but 


466 


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■uai  MNinaio  CO.  Mc 

W7  C  Sam.  N  t  25 

Vakiafm.  O  C     »as> 


that's- 


NCLASSIHED 


460 


Q    Our  analysis  indicates  this  came  out  of  an  IBC  bank 
account.   Is  that  inconsistent  with  your  recollection? 

A    My  recollection  was  that  it  came  out  of  the  Miller 
Communications  account,  but  that  may — I  wouldn't  be  able  to 
swear  to  either  one  of  them  without  looking  at  the  bank 
records . 

Q    In  any  case,  you  recall  a  payment  to  Frederick 
Arguello  in  November  of  1986  of  $10,000  that  was  made  at  the 
direction  of  Colonel  North,  right? 

A    Correct.   Can  we  take  a  quick  break? 

Q    Sure . 

Q    Turning  to  page  16,  or  continuing  on  page  16,  Mr. 
Miller,  there  are  two  payments  on  that  page,  in  July  of  1985, 
of  $50,000  each,  to  Gary  Bagdasarian,  and  I  believe  Mr.  Kaplan 
asked  you  some  questions  about  Gary  Bagdasarian  at  an  earlier 
session  of  your  deposition. 

But  I  want  to  just  pursue  this  a  bit  more.   Do  you 
recall  making  two  $50,000  payments  to  Mr.  Bagdasarian  in  July 
of  19857 

A    Yes. 

Q    I  believe  you've  testified  earlier,  that  this  had 
some  relation  to  your  association  with,  aldda&aoutii? 

A    That's  correct. 

Q    Did  al-Massoudi  request  that  you  make  these 


sciation  with  al-Ma&anudi7 


467 


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■UJii  ■votmHO  CO,  «c 

M7  C  Smi.  N  E.  2  5 

Variuafioa.  DC.    20002 
(202)  Vtt-ttM 


illiSSlFlED 


461 


payments  to  Mr.  Bagdasarian? 

A    Yes. 

Q    What  did  you  understand  was  the  reason  for  the 
payments? 

A  It  was  some  performance  bond  which  needed  to  be 
satisfied,  and  Mr.  Bagdasarian  is  his  attorney  and  he  was 
responsible  for  taking  care  of  it. 

Q    Now  the  association  with  al-Massoudi  was  an 
association  that  you  were  pursuing  at  the  request  of  Colonel 
North,  is  that  correct? 

A    Correct. 

Q    Now,  did  Colonel  North  arrange  for  you  to  be  reim- 
bursed for  this  $100,000? 

A    Yes . 

Q    How  did  he  do  that? 

A    It  was  a  reimbursement  that  came,  I  think  before 
the  end  of  1985. 

.  Q    How  was  the  reimbursement  paid  to  you? 

A    Well,  I  kept  a  running  ledger  sheet  which  I 
provided  him  copies  of,  which  showed  subtractions  from  the 
money  given  to  us  by  NEPL  and  other  sources,  and  the  subtrac- 
tions were  for  expenditures  made  by  his  direction,  or  on  his 
behalf,  and  I  would  have  reported  it  in  that  fashion.   So  it 
would  have  been  a  subtraction  situation  for  me.   I  would  have 
subtracted  it  from  the  total . 


mjmm 


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25 


SIUSSIRED 


462 


Q  So,  when  you  refer  to  the  monies  paid  by  NEPL,  are 
you  referring  to  the  monies  paid  by  NEPL  to  the  IBC  account, 
that  you  then  relayed  to  the  IC  account,  and  then  relayed  to 
other  entities  at  Colonel  North's  direction? 

A    No.   As  I've  testified  earlier,  the  problem  that  we 
encountered  was,  in  the  beginning  we  were  doing  a  lot  of 
Colonel  North's  business  out  of  the  IBC  accounts,  and  we 
eventually  tried  to  move  it  all  into  the  IC,  Inc.  account. 

Q    Right. 

A  But  this  is  an  early  instance  in  which  we  expended 
money  directly  out  of  the  IBC  accounts  for  one  of  the  things 
that  he  had  directed. 

Q    Right.   But  going  back  to  your  July  1985  meeting 
with  Colonel  North  and  Mr.  Channell,  where  there  was  a 
discussion  that  NEPL  would  transfer  a  certain  number  of 
dollars  to  one  of  your  accounts,  and  then  you  would  arrange 
to  transfer  those  monies  to  other  entities  at  the  direction 
of  .Colonel  North — am  I  correct  in  understanding  from  your 
answer,  that  at  some  point  in  1985,  Colonel  North  authorized 
you  to  hold  for  your  own  purposes  $100,000  of  such  funds  that 
NEPL  had  transferred  as  reimbursement  for  these  expenditures 
to  Mr.  Bagdasarian? 

A    Yes.  i;;?«^i]> 

7JL, 

Q    Turning  to  page  17,  there's  an  indication  of  a 
payment  by  IBC  to  Bruce  Cameron  of  $10,000  in  January  1986. 


469 


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MUjn  MVOKTatO  CO..  MC 

yn  c  SiRR.  N  E  25 

Tukiofnai.  DC.    2000] 


lISUlSSinED 


463 


Do  yau-  recall  paying  such  an  amount  to  Mr.  Cameron?  - 

A    Yes. 

Q    What  was  that  for? 

A    It  was  for  a  legislative  analysis  by  Mr.  Cameron  on 
the  climate  on  Capitol  Hill  for  continued  aid  to  the  Nicara- 
guan  resistance. 

Q    Was  this  for  a  particular  paper  that  he  was 
preparing  for  you,  or  was  it  for  continued  services  over  a 
period  of  'time? 

A    I  recall  that  there  was  some  form  of  a  report — 
there  may  have  been  more  than  one — but  beyond  that,  I  can't 
recall  the  specifics  of  the  relationship  without  going  back 
and  looking  at  my  records . 

Q    How  did  you  happen  to  retain  Mr.  Cameron? 

A    Bruce  was  recommended  to  us  by  PeivKemble  of  the 
Institute  for  Religion  and  Democracy,  and  we  received  a 
recommendation  from  Elliott  Abrams  also. 

.  Q    When  you  say  you  received  a  recommendation,  do  you 
recall  what  they  said  about  him,  what  was  the  nature  of  the 
recommendation? 

A    That  he  was  working  hard  for  the  policies,  and  that 
he  had  been  made  to  pay  a  heavy  price  by  his  former  col- 
leagues ,  and  that  if  there  was  a  way  to  incorporate  him  into 
the  effort  we  should  do  it.   And  all  those  conversations  were 


predicated  on  the  fact  that  we  vn 


mrj^'RWf!^ 


wg  for  somebody  to 


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ICO.. 


J07  C  Stun.  N  E.              2  5 
WaihiofToo.  D  C     iOOOl 
(20J)  i*6<Mi 


m 


464 


iii 


do  precisely  that,  and  in  our  book  those  two  things  were 
qualification  enough  for  him. 

Q    Did  Mr.  Abrams  indicate  that  Mr.  Cameron  had  been 
useful  in  the  effort? 

A    I  don't  recall  that.   I  recall  Elliott  saying  that 
he  was  a  good  man,  and  that  he  knew  Central  America  extremely 
well  and  knew  the  legislative  process  involving  Central 
America  extremely  well. 

Q    .When  did  this  discussion  with  Mr.  Abrams  occur? 

A    I  can't  recall,  specifically,  but  some  time  around 
December,  I  guess. 

Q    Was  it  just  you  and  Mr.  Abrams? 

A  As  I  recall  it  was  a  phone  conversation,  but  my 
recollection  is  sketchy.  I  think  I  got  a  letter  from  Pery 
Kemble,  and  I  think  I  got  a  phone  call  from  Elliott  Abrams. 

Q         Asking  you  to  retain  Cameron? 

A    Hell,  the  letter  from  Pen/Kemble  asked  me  to  retain 
CaiQieron.   The  phone  call  from  Elliott  Abrams  was  what  I  had 
just  recounted  to  you. 

Q    I  mean,  did  you  consider  that  a  request  by  Mr. 
Abrams,  that  you  retain  Cameron? 

A    No.   I  considered  it  a  recommendation  by  Mr.  Abrams. 

Q    But  is  it  your  recollection  that  that  was  the 
principal  subject  of  the  phone  call,  that  he  called  you  with 
respect  to  a  recommendation  of  Mr.  Cameron 


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laian  MMXTMo  CO.  Mc 

J07  C  SiHR.  N.E.  2  5 

VaAidttea.  0  C.    10002 


mm  K'^iP'Fn 


465 


A    Yes. 

Q    Are  you  aware  that  Mr.  Channell  also  retained  Mr. 
Cameron  in  1986? 

A    Yes. 

Q    Do  you  know  the  purpose  for  which  Mr.  Channell 
retained  Mr.  Cameron? 

A    Well,  in  general  terms,  yes. 

Q    Did  you  discuss  with  Mr.  Channell  his  retention  of 
Mr.  Cameron? 

A    Well,  actually,  I  think  this  transaction  that  you 
and  I  just  discussed  a  moment  ago  was  the  beginning  of  that 
relationship,  and  then  I  think  it  continued  on.   I  can't 
attest  to  the  financial  transactions  between  the  two  of  them 
because  I  wasn't  made  aware  of  them,  but  the  general  work 
continued  to  be  about  the  same,  legislative  analysis. 

Q    Was  Mr.  Cameron  performing  lobbying  services? 

A    I  don't  think  under  his  contract  with  NEFL  he  was 
pecformlng  lobbying  services .   He  may  have  received  money  from 
Mr.  Channell  for  lobbying  services,  but  I'm  not  positive 
about  that. 

Q    Was  he  performing  lobbying  services  for  you? 

A    I  didn't  consider  this  lobbying  services. 

Q    What  period  of  time  did  his  services  cover  for  you, 
for  which  you  paid  him  $10,0007  H ||ljL/\NN|r  jl' jj 

A    Actually,  I  think  that  isiJlO,000  out  of  a  total 


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■U0  HvoimMa  CO..  mc 
W7  C  Snett.  N  E.  2  5 

Vnhiniton.  DC.    20002 


466 


conunitment  to  him  of  about  $40,000,  and  it  spanned  several 
months,  and,  again,  without  looking  at  the  letters,  the 
exchange  of  letters  or  subsequent  documents  in  the  file,  I 
can't  tell  you  exactly  how  many  months  it  was. 

But  it's  at  least  four  months,  and  it  entailed  more 
than  just  Mr.  Cameron.   It  entailed  employees  of  Mr.  Cameron. 

Q    Well,  is  it  your  recollection  that  your  company 
paid  him  $40,000? 

A    .No.   It's  my  recollection  that  the  original  request 
from  him  was  for  $40,000,  and  I  think  this  $10,000  is  the 
initial  payment  of  that  $40,000. 

Q    Is  it  your  recollection  that  subsequent  payments 
came  directly  from  Mr.  Channell? 

A    I  think  that's  right.   I'm  hazy  on  my  recollection 
but  I  think  that's  correct. 

Q    Has  there  some  reason  that  there  was  a  transfer  of 
compensation  to  Mr.  Cameron  from  your  organization  to  Mr. 
Channell 's  organization? 

A    Mr.  Channell  wanted  it  that  way. 

Q    He  did? 

A    Tes. 

Q    That's  something  you  recall  discussing  with  Mr. 
Channell? 

A    Yes, 


UNOIASSIFIEB 


Do  you  know  why  he  wanted  it  that  way? 


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MLUR  RVOffTWO  COh  M 
507  C  imtt.  N  E  2  5 

Wuhinilaa.  DC      20002 


No. 


mussffl 


467 


He  didn't  indicate  why  he  wanted  it  that  way? 
Not  that  I  specifically  remember. 
Continuing  on  page  17  of  Exhibit  29,  Mr.  Miller, 
there's  a  reference  to  a  payment  of  $9,300  to  Ricardo 
Carrasco  in  October  of  1985.   Do  you  recall  such  a  payment? 

A    I  don't.   I've  never  seen  the  name  Ricardo  Carrasco, 
or  don't  recall  seeing  it. 

Q    So  you  have  no  idea  what  such  a  payment  would  have 
been  for? 

A    Again,  I've  never  heard  of  Ricardo  Carrasco,  or  at 
least  I  don't  remember  Ricardo  Carrasco  in  any  way. 

Q    All  right.   At  the  bottom  of  that  page,  there's  an 
indication  of  a  payment  in  September  of  1985  to  Arturo  Cruz 
of  $10,005.   Do  you  recall  such  a  payment  in  September  of 
1985? 

A    Yes.   The  five  dollars  is  simply  a  charge  for  a 
cas_hier's  check. 

Q    So  the  payment  was  for  $10,0007 

A    That's  correct. 

Q    We  were  talking  earlier,  on  that  same  page,  about 
the  notations  of  payments  to  cash  in  March  and  April  of  1986 
for  $20,005  and  $20,010.   Do  those  amounts  indicate  to  you 
that  those  were  cashier^s^ cbf aJra^or  treasurer's  checks  as 


474 


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■mil  w>o«TMii  CO-  me. 

M7C5uTn.  NE  25 

Valuaraa.  O  C     20002 


UNGlASSinED 


468 


A    It's  entirely  possible  that  those  are  service 
charges  for  cashier's  or  treasurer's  checks. 

Q    why  did  you  pay  Mr.  Cruz  $10,000  in  September  of 
1985? 

A    Colonel  North  asked  me  to. 

Q    What  was  the  source  of  those  funds? 

A    That  was  NEPL  money. 

Q    Turning  to  page  18,  we  were  talking  earlier  about 
payments  t)o  David  Fischer,  and  you  will  note  that  there  is  an 
indication  of  a  $50,000  payment  to  David  Fischer  and  As- 
sociates on  April  18,  1986. 

Does  that  refresh  your  recollection  about  such  a 
payment  in  that  amount,  in  April  of  1986? 

A  Again,  Z  recall  making  a  $50,000  payment  to  Mr. 
Fischer.  I  don't  recall  a  specific  date,  but  I'll  accept 
your  record  of  it. 

Q         Why  did  you  make  a  $50,000  payment  to  Hr.  Fischer? 

A    He  requested  it. 

Q    That's  the  only  reason? 

A    That's  correct. 

Q    You  indicated  earlier  this  morning  that  you  had  a 
commitment  to  Mr.  Fischer  and  Mr.  Artiano  to  pay  them 
$480,000,  is  that  correct?, 

A    That's  correct. 

Q    You  understood  that  they  had  performed  the  services 


ana   ru.  •    A£«.xaiiw  bw  paj  ^' 


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■aioi  wyuwmu  eo..  mc 
»?  C  SuMt.  N  E  2  5 

Waihiiicraa.  0  C     20002 


wxmm 


469 


for  which  they  were  entitled  to  be  paid  that  amount  during  a 
period  of  six  months? 

A    That's  correct. 

Q     That  six  months  began  in  December  of  1985? 

A    Actually,  January  of  1986. 

Q    It  began  in  January  of  1986. 

A    They  began  work  in  December,  but  the  period  that  I'm 
talking  about,  the  intensive  work  that  they  carried  out,  was 
in  the  first  six  months  of  1986. 

Q    The  six  months  ending  June  of  1986? 

A    That's  correct. 

Q    You've  also  indicated  this  morning,  that  you  paid 
Mr.  Fischer  $105,000  of  that  $480,000  in  January  or  February 
of  1987.   Is  that  correct? 

A    That's  correct. 

Q     So  is  it  correct,  that  in  effect,  you  owed  Mr. 
Fischer  more  than  $100,000  for  a  six-month  period?   He  had 
coiqpleted  his  services  in  June  of  1986,  but  you  did  not  finish 
compensating  him  for  those  services  until  January  of  1987? 

A    As  I  told  you  earlier  in  my  testimony,  our  agreement 
was  for  $20,000  a  month  for  24  months,  and  within  reason, 
they  could  make  cash  calls  along  the  way,  and  both  that 
$50,000  and  the ViO^/that.ypiL' ye .384(94 v^f^^llt  were  the 


BtCRSsra 


result  of  cash  calls 

Q    But  the  services  that  were  being  performed  for  those 


476 


art470 


107  C  Smn.  N  I. 
w^MMi.  0  c.  neei 


UNtUfiSW 


470 


monies  were  completed,  in  your  view,  in  June  of  1986? 

A    That's  correct. 

Q  Also  on  page  18,  Mr.  Miller,  there's  an  indication 
of  payment  to  something  called  Eason,  E-a-s-o-n,  Associates. 
Do  you  know  what  Eason  Associates  is? 

A    Yes.   That's  my  graphic  arts  subcontractor. 

Q    Do  you  recall  a  payment  to  Eason  Associates  of 
$12,000  in  June  of  1986? 

A    Not  specifically. 

Q    Were  any  payments  that  you  made  to  Eason  Associates 
payments  for  services  that  they  rendered  to  your  organization/ 

A    Yes.   They  all  were. 

Q    Payments  for  services  in  the  area  of  graphic  arts? 

A    That's  correct. 

Q    Who  was  Rafael  Flores? 

A    He's  an  employee. 

Q    You  will  note  on  page  18,  there  are  indications  of 
periodic  payments  to  Mr.  Flores,  the  first  of  approximately 
$477,  and  later,  approximately  $524.^.   Do  you  recall  such 
periodic  payments  to  him? 

A    I'm  sure  they're  salary  payments. 

Q    Salary  payments.   Now  there's  also  an  indication  of 
two  significantly  larger  payments  to  Mr.  Flores,  one  in 
January  1986  of  S5 .  128 ^4^  jm^  A-a.econd  on  March  11,  1986,  of 
$6,740.69. 


477 


art471 

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UIXOI  NOOHTIMO  CO..  MC. 
M7CStnct.  NE  25 

Wuhintna.  0  C     20002 


UNCUSSIHED 


471 


Do  you  recall  such  larger  payments  to  Mr.  Flores? 

A    Not  specifically. 

Q    Well,  do  you  ever  recall  making  payments  to  Mr. 
Flores  apart  from  his  monthly  salary  payments? 

A    Yes. 

Q    For  what  purposes? 

A    He  was  the  principal  escort  in  the  beginning  of  the 

Central  American  Freedom  Program  for  our  speakers,  and  later, 

was  one  of'  several  escorts,  and  he  didn't  carry  any  credit 

^>  ■ — 

cards,  and  he  generally  travelled  with  traveller's  checks  as 

opposed  to  using  credit  cards,  and  that's  the  way  he  paid  his 

bills  on  the  road. 

Q    Well,  is  it  your  recollection  that  you  provided 
traveljler's  checks  to  him  by  means  of  an  IBC  check  payable  to 
him? 

A    To  him,  to  cash,  or  to  NBW,  or  to  American  Express, 
any  one  of  those  ways. 

.  Q    Do  you  have  any  recollection  of  any  other  larger 
payments  to  Mr.  Flores? 

A    Not  offhand,  no. 

Q    Turning  to  page  19,  there  is  an  indication  of 
payments  to  H-u-m-b-e-r-t-o  Q-u-i-n-o-n-e-s.   Do  you  recall 
payments  to  an  individual  named  Humberto  Quinones? 


Yes. 


Who  is  Mr.  Quinones? 


UNCUSSIFiED 


478 


art472 


UNCUSSinED 


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Hum  mromwta  co..  mc. 

J07  C  Siren.  NE.  2  5 

Vuhiofioa.  DC     lOOOl 


A    He  is  a  consultant  to  IBC. 

Q    Why  were  you  paying  him  money? 

A    For  a  client  matter  unrelated  to  this  investigation. 

Q    A  matter  that  has  not  relation  to  your  work  for  the 
Nicaraguan  resistance? 

A    That's  correct. 

Q    What  is  his  area  of  specialty? 

A    Predominantly  the  Caribbean  and  South  America. 

Q    You  mean  he's  knowledgeable  about  political  matters 
in  that  area? 

A    Political,  but  predominantly  business,  trade,  and 
development. 

Q    Does  he  have  his  own  firm? 

A    I  believe  he  does  have  his  own  firm,  yes. 

Q    Do  you  know  what  his  background  is? 

A    He's  a  Cuban-American,  and  he's  done  work  with 
several  Central  American  and  Caribbean  governments. 

Q    Turning  to  page  20,  there's  an  indication  of  a 
payment  in  March  1986  of  $6,206.85  to  Kemp  Enterprises. 
Do  you  recall  a  payment  to  Kemp  Enterprises? 

A    Yes. 

Q         What  is  Kemp  Enterprises? 


MlASSm 


A  That  is  a  producer,  whose  last  name  is  Kemp,  who 
produced  the  "Bitter  Legacy"  film  for  us  under  the  Central 
American  Freedom  Program.   I  can't  recall  his  first  name.   I 


479 


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■usi  ROOKTMa  eo^  Mc 

)07  C  SoMi.  N  E  2  5 

Wuhiaina.  DC     20002 


473 


can't  remember  his  first  name. 


UNCLASSIRED 


Q    Is  it  your  recollection  that  there  was  a  payment  in 
the  range  of  $6,000  in  March  of  1986  for  the  preparation  of 
that  program? 

A    Yes . 

Q    Who  is  Kevin  Hopkins? 

A    He's  a  writer. 

Q  Do   you   recall   paying  Kevin  Hopkins    $5,000    in  the 

suiraner  of    1986? 

A  Yes. 

Q    Why  did  you  pay  him  that  money? 

A    It  was  for  writing  a  brochure. 

Q    About  what? 

A    IBC.   Well,  Kevin  did  many  things,  so  I'm  not  sure 
exactly  which  activity  that  was  for. 

Q    Did  he  perform  any  services  in  connection  with  your 
work  on  behalf  of  the  Nicaraguan  resistance? 
.   A     No. 

Q    There's  a  notation  on  page  20,  Mr.  Miller,  that  IBC 
paid  $25,000  to  the  Latin  American  Strategic  Studies  Institute 
in  March  1986. 

Do  you  recall  paying  such  an  amount  at  approximately 


that  time? 


Yes. 


IHCUSSlflED 


Why  did  you  pay  those  monies? 


480 


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MULin  mromta  co..  mc 
WT  c  Sut«.  N  E  25 

Vuhuitna.  D  C      )<n<' 


ONCLASSIFIED 


474    I 


A    It  was  requested  by  Dr.  Calero  and  approved  by 
Colonel  North. 

Q    What  was  the  source  of  those  funds? 
A    That  was  NEPL  money. 

Q    Who  is  Gerald  McElsay?  M-c-E-1-s-a-y. 
A    I  have  no  idea. 

Q    There's  an  indication  on  page  21  of  a  $10,000 
payment  to  Gerald  McElsay  in  July  of  1985.   Do  you  have  any 
recollection  of  such  a  payment? 

A    I  don't  remember  the  name,  Gerald  McElsay.   I'd 
have  to  go  back  to  my  business  records. 

Q    Turning  to  page  22,  do  you  know,  or  do  you  recognize 
the  name  Shokiri  Moniereh?   S-h-o-k-i-r-i.   M-o-n-i-e-r-e-h. 
A    Yes,  but  it's  inverted. 
How  should  it  appear? 
Moniereh  Shokiri. 
Who  is  that  individual? 
That  is  Ibrahim  al-Massoudi's  wife  and  business 


Q 
A 
Q 
A 

partner 
Q 


Did  you  make  payments  to  her  of  approximately 


$46,000  in  1985? 


Yes. 


UNClASSra 


Q    Why  did  you  make  those  payments? 

A    These  were  payments  for  office  expenses,  telephone, 
Telex,  and  fees  associated  with  the  al-Massoudi  business. 


481 


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Mijni  nutmrwtQ  eo..  mc 

M7C5u«i.  NE  25 

Vuhufioa.  0  c.   :oao: 


UriSLASSlFIED 


475 


Q  .  Now  were  you  reimbursed  for  those  expenses? 

A    Yes. 

Q    Colonel  North  authorized  you  to  be  reimbursed  for 
those  expenses? 

A    Yes. 

Q    What  was  the  source  of  funds  for  that  reimbursement? 

A    NEPL. 

Q  Now  we've  talked,  Mr.  Miller,  about  your  being 
reimbursed  for  the  payments  to  Gary  Bagdasarian,  and  the 
$46,000  in  payments  to  Moniereh  Shokiri. 

There's  also  a  notation,  on  page  21,  of  a  $25,000 
payment  to  Massoudi  in  July  of  1985.   Do  you  recall  that 
payment? 

A    Not  specifically. 

Q    Well,  do  you  recall  paying  monies  to  al-Massoudi? 

A  I  don't  remember  this  entry,  specifically.  It 
doesn't  refresh  a  specific  recollection. 

_  Q    Did  you  keep  a  record  of  all  of  the  funds  that  you 
had  expended  on  behalf  of  al-Massoudi? 

A    Yes,  and  we  also  produced  a  1099  at  the  end  of  1986. 

Q    Did  you  ask  Colonel  North,  that  you  be  authorized 
to  be  reimbursed  for  all  of  the  expenditures  you  had  made  on 


HNClASSra 


behalf  of  al-Massoudi? 
A    Yes. 
Q    Did  he  authorize  such  reimbursement? 


482 


art476 

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Mun  neKMrrwa  co..  mc 

50?  C  Soto.  N  E  25 

Vuhmfloa.  D  C      20002 


Yes. 


wiAssra 


476 


Q     Did  you  take  such  amounts  out  of  the  NEPL  funds? 

A    Yes . 

Q    What  is  your  recollection  of  the  total  amount  of 
the  reimbursement? 

A    At  this  point,  it's  about  350-sorae  thousand 
dollars.   Our  accountants,  in  their  first  1099,  missed  the 
second  $50,000  transfer  to  Bagdasarian,  so  they  reported  it 
in  the  1099  as  $291,000,  I  think,  or  290-some  thousand,  and 
actually  there  was  another  $50,000  for  Bagdasarian.   And  they 
missed  one  other  item,  but  I've  forgotten  exactly  how  much  it 
was. 

Q    So  it  was  approximately  $350,000? 

A    That's  right. 

Q    You  took  approximately  $350,000  from  the  NEPL 
funds,  pursuant  to  the  authorization  from  Colonel  North? 

A    My  only  problem  with  your  using  the  word  NEPL-- 
there  may  have  been  other  funds  that  came  back  from  IC,  Inc. 
through  World  Affairs  Counsellors,  but  I  couldn't  swear  to 
that.   But  it  was  for  money  for  the  resistance.   It  was  from 
money  for  the  resistance. 

Q    Now  we  talked  earlier  about  your  discussions  with 
Colonel  North  where  he  authorized  you  to  take  a  10  percent 
fee  for  your  services  in  making  tjies^ transfers  of  the  NEPL 
funds . 


iMSlFIED 


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MUSI  aVORTMO  CO..  MC 

J07  C  Stnti.  N  E  2  5 

Vuhinfraa.  DC     20002 


ILHSSifiED 


477 


Am  I  correct  in  understanding  that  his  authorization 
of  the  reimbursement  of  the  funds  you  had  expended  on  behalf 
of  al-Massoudi  was  in  addition  to  this  10  percent  service 
charge  that  he  authorized  you  to  take? 

A  That's  correct.  I  would  say  that  the  510,000  was 
as  much  a  reaction  to  the  al-Massoudi  business,  though.  Or 
10  percent.  Excuse  me.  And  that  it  was  clear  to  me,  after 
the  business  year  came  to  a  close  in  1986,  or  '85,  that  we 
were  expending  an  extreme  amount  of  time  on  this,  and  going 
in  the  hole,  and  that  wasn't  acceptable.  You  can't  continue 
doing  business  that  way. 

Q    Correct.   But  it  was  not  your  understanding  that 
your  reimbursement  of  the  $350,000  that  we've  been  discussing 
was  to  come  from  the  10  percent  service  charge  that  Colonel 
North  had  authorized? 

A    That's  correct. 

Q    You  were  to  be  reimbursed  directly  on  a  dollar- for- 
doUar  basis  from  the  funds  transferred  to  your  accounts? 

A    That's  correct. 

Q    Turning  to  page  23,  there  is  a  reference  at  the  top 
to  M-o-u-f-i-d,  slash,  A-r-n-o-u-s .   Do  you  recognize  that  as 


a  name? 


Who  is  that  person? 


UNCLASSIFIED 


He's  a  business  partner,  associate  of  al-Massoudi 


484 


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HLUn  NOOtmNO  co..  mc. 
507  C  Su«t.  N  E  25 

".Aui—iio    O  C      20002 


yNSliSSIFIED 


478 


Q    IS  that  the  correct  way  that  you  understand  the 
name  should  be  written?   Moufid  Arnous? 

A    Yes. 

Q    Do  you  recall  paying  him  $12,000  at  the  request  of 
al-Massoudi? 

A    Yes.   And  the  second  item  that  you  have  listed,  the 
ten  thousand,  may  be  the  $10,000  associated  with  the  airline 
tickets  I  was  recalling,  but  I'm  very  hazy  on  the  recollec- 
tion. 

Q    Were  payments  to  Moufid  Arnous  part  of  the  reimbur- 
sement that  Colonel  North  authorized? 

A    Yes .  ! 

Q    Now  continuing  on  page  23,  and  24  as  well,  Mr. 
Miller,  there  is  indication  of  a  variety  of  payments  from  IBC 
to  the  National  Bank  of  Washington,  and  I  want  to  review  some 
of  these  with  you. 

First,  there  is  an  indication  of  periodic  payments 
to. the  National  Bank  of  Washington  in  the  range  of  $5,000, 
and  another  group  of  periodic  payments  in  the  range  of  $3,000 

Do  you  recall  your  company  making  a  number  of 
payments  to  the  National  Bank  of  Washington  in  tjie  53,000  and 
$5,000  range?  it^ini  IVVV^flT^I 

A    Not  specifically,   llg 4 


Oil 


MR.  PRECUP:   I  think  the  record  should  reflect  that 


in  the  series  to  which  Mr.  Fryman  has  just  pointed 


0-^1 


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■1X0  WPOMTVM  CO..  MC 
M7  C  Sotn.  N  (.  25 

Vatkafiaa.  D  C     200S> 


K 


CLASSinED 


479 


of  the  checks  seem  to  be  in  identical  amounts.   There  are 
some  checks  that  are  in  the  amount  of  3,000,  some  in  the 
amount  of  five,  both  with  change,  if  you  will,  but  not  what  I 
think  are  fairly  characterized  as  periodic  payments . 

MR.  FRYMAN:   Let  me  approach  this  another  way, 
then,  Mr  Precup. 

BY  MR.  FRYMAN: 

Q    Was  the  National  Bank  of  Washington  the  principal 
bank  for  IBC? 

A    Yes. 

Q    Did  IBC  have  loans  with  the  National  Bank  of 
Washington? 

A    We  have  had  two  loans,  I  believe,  with  the  National 
Bank  of  Washington. 

Q    What  was  the  nature  of  those  loans? 

A    Business  loans.   We  borrowed  money  from  them,  ■aiK 
based  on  future  receivables,  and  repaid  it. 

Q    Did  you  repay  it  on  a  monthly  basis  or  was  it  a 
demand  note  with  the  total  principle  to  repay  it  at  a  certain 
date? 

A    As  I  recall,  they  were  both  demand  notes,  and  they 
were  paid  in  full. 

Q    All  right.   So  you  had  no  other  loan  relationship 
with  the  National  Bank  of  Washington  other  than  those  two 
specific  loans  you've  referred  to?j 


UNCussra 


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IMUIR  WMUHmU  CO..  MC 
S07CSn««.  NE  25 

T.k.hioroil    DC      20002 


HCLASSlFiED 


480 


A    That's  correct. 

Q    Now,  did  you  use  the  National  Bank  of  Washington  in 
connection  with  making  tax  payments? 

A    Yes. 

Q     How  did  that  work? 

A    We  made  our  tax  payments  at  the  National  Bank  of 
Washington. 

Q    These  are  employee  taxes? 

A    All  forms  of  taxes. 

Q    Withholding  taxes.   And  so  you  made  a  number  of 
periodic  checks  to  the  National  Bank  of  Washington  for  that 
purpose? 

A    Well,  I  don't  know  how  to  characterize  it,  whether 
I'd  characterize  it  as  "periodic,"  but  I'm  sure  that's  the 
form  in  which  we  paid  our  payroll  taxes,  was  by  check. 

Q    All  right.   By  checks  payable  to  the  National  Bank 
of  Washington? 

A    I  believe  that's  correct.   I  think  that's  how  you'd 
pay  them. 

Q    Now  other  than  payments  to  the  National  Bank  of 
Washington  for  interest  on  the  loan  and  repayment  of  the 
principle  on  the  loan,  and  payments  to  the  National  Bank  of 
Washington  for  various  taxes,  what  other _^ 
to  the  National  Bank  of  Was-hington?  su^ib] 

A    None  that  I'm  aware  of  other  than  registration 


487 


MT  C  Smn.  N  E. 
«a*ama.  O.C  MOO] 


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fees,  or  standard  banking  fees. 

Q         Did  you  purchase,  from  tine  to  time,  cashier's 
checks  or  traveller's  checks,  cr  treasurer's  checks,  at  the 
National  Bank  of  Washington? 

A    I'm  sure  at  some  time  we  purchased  all  three  of 
those. 

Q    Now  directing  your  attention  again  to  page  23, 
there's  an  indication  of  a  payment  to  the  National  Bank  of 
Washington  in  April  1985  of  $14,005.1^. 

Do  you  recall  a  payment  in  that  amount  at  that 
approximate  time? 

A    Not  specifically,  no. 

Q    Does  that  $5  amount  indicate  to  you  that  that  was  a 
check  for  the  purchase  of  a  cashier's  check  or  treasurer's 
check? 

A    That  is  possible,  but  it  still  doesn't  refresh  my 
recollection. 

.  Q    Well,  do  you  recall  the  purchase  of  a  cashier's 
check  or  treasurer's  check  in  April  of  1985  for  $14,000? 

A    Not  specifically. 

Q    There's  also  an  indication  of  a  payment  to  the 
National  Bank  of  Washington  in  August  1985  of  $18,545.1^   Do 
you  recall  a  payment  of  that  amount  at  about  that  time? 

A    That  was  the  payment  I  had  described  to  you  earlier 
as  one  of  the  a L-iteMfl'tfli^ nMWJBtyfMiUng  with  the  hostage 


•vittyint^nFr 


488 


art482 


M7  C  Sum.  N  E  25 

.  D  C.    20001 


mMB 


482 


situation. 

Q  Why  was   that  payable  to  the  National   Bank  of 

Washington? 

A  I   think  it  was   for  traveller's  checks   and  they  were 

transmitted   to   him   in  Geneva. 

Q  Was   that  an  amount  that  Colonel  North  authorized 

the  reimbursement   from  the  NEPL   funds? 

A  Yes . 

Q    'There's  also,  at  the  bottom  of  page  23,  an  indica- 
tion of  a  payment  of  $20,010  to  the  National  Bank  of  Washing- 
ton on  May  15,  1986. 

Do  you  recall  a  payment  of  approximately  that 
amount  at  approximately  that  date? 

A    Not  specifically,  no. 

Q    Turning  to  page  24,  there's  an  indication  of  two 
payments  to  the  Nicaraguan  Development  Council,  one  in 
December  1985  of  $6,000,  and  one  in  March  of  1986  of  $25,000. 
Do  you  recall  those  payments? 

A    I  recall  making  payments  in  that  amount  to  the 
Nicaraguan  Development  Council. 

Q    Why  did  you  make  such  payments? 

A    I  can't  recall,  at  the  moment,  what  specifically 
they  were  for. 

Q    Were  these  payments  made_  _a_t  Jj\fi.  direction  of 
Colonel  North? 


489 


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MXIN  WPODTKa  CO..  MC 
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Vuhaoran.  DC     20C02 


\iiW 


483 


A    If  not  the  direction,  at  least  the  approval  of 
Colonel  North. 

Q    Were  these  from  the  NEPL  funds? 

A    Yes. 

Q    Also  on  that  page,  there's  an  indication  of  two 
payments  to  Mr.  Robelo  of  $30,000  each,  one  in  July  of  1985, 
and  the  other  in  September  of  1985. 

Do  you  recall  such  payments? 

A     I  recall  transferring  two  $30,000  payments  to 
Commercial  Tooling  in  Costa  Rica,  and  I  was  aware  at  the  time 
that  that  was  a  Robelo  organization. 

Q    Were  these  transfers  from  the  IBC  account? 

A    Yes. 

Q    Were  these  done  at  the  direction  of  Colonel  North? 

A    Yes. 

Q    Also  on  page  24,  Mr.  Miller,  there  is  an  indication 
of  a  payment  of  $20,000  on  January  21,  1986,  and  our  accoun- 
tants have  not  been  able  to  identify  the  recipient. 

Do   you  recall  a  payment  of  $20,000  on  January  21, 


1986? 


Not  specifically. 

Who  is  Lawrence  Stuart  Young? 

He's  a  television  producer  in  Miami. 

Do  you  recall  making  payments^o  him  in  1985? 

Yes. 


■isttj^sro 


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MUJR  Rvomwo  CO..  MC 
V)7CSUKI.  NE  25 

HutuBfOa.  0  C      20002 


liNCLASSinED 


484 


Q    What  was  the  purpose  of  those  payments?   •■  -   .  -  - 

A    He  was  the  director  and  field  producer  for  our 
first  documentary  with  Dr.  Joachim  Maitre. 

Q    Did  those  payments  total  approximately  $13,000,  to 
your  recollection? 

A    Yes. 

Q    What  was  the  subject  of  that  documentary? 

A    The  freev-om  fighters  and  their  military  viability, 
and  their  level  of  popular  support  in  Nicaragua. 

Q    Was  that  the  documentary  that  was  later  revised  by 
the  Robert  Goodman  Agency? 

A    Yes. 

Q    What  is  ZGS? 

A    It's  a  videotape  production  company. 

Q    Did  you  make  payments  to  that  company  in  1986? 

A    Yes. 

Q    What  was  the  purpose  of  those  payments? 

A    Those  were  production  costs  associated  with  our 
multiple  client  responsibilities,  some  of  them  NEPL,  some  of 
them  other  clients. 

Q    You  described  ZGS  as  a  production  company? 

A    That's  correct.  Videotape  production  company. 

Q    Do  you  mean  that  they  would  take  a  script  and  they 
would  film  a  commercial?  Or  what  would  they  do? 

A    "^^^y ■^'MFt #t1^  M-fMV^ri-VIly  °^   ^^^  NEPL  television 


mnviiW»Pf\' 


491 


485 


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mjjot  wwjuma  eo„  wc 

507  C  Soto.  N  E.  25 

Vaihiofton.  D  C-    20002 

(202) 


conunercials-  This  is  documentary  production,  credits,  film 
duplication,  editing,  general  production,  videotape  produc- 
tion. 

Q    Who  is  Tony  Zumbado? 

A    He's  a  producer  from  Miami  who  was  employed  during 
the  Central  America  Freedom  Program  to  develop  the  contra- 
film  units. 

Q    What  is  that? 

A  He  actually  had  ceunera  crews  who  were  resident  in 
Nicaragua,  and  Honduras  and  Costa  Rica,  whom  he  retained  to 
shoot  film  footage.  He  was  the  principal  field  producer  on 
the  Wesley  Smith  documentary. 

Q    You  paid  him  approximately  $30,000? 

A    Yes . 

Q    What  was  the  Wesley  Smith  documentary? 

A    It's  called  "Bitter  Legacy"  and  it  is  about  the 
Sandinista  repression  of  religious  and  political  opposition  in 
Nicaragua. 

Q    Is  that  the  documentary  that  Mr.  Young  worked  on? 

A    No. 

Q  So  that's   a  different  documentary  than  the  one  that 

the  Goodman  Agency  revised? 
A  That's   correct. 

Q  What  use  was  made  of    "Bitter  Legacy"? 

A  It  was   crQ'^dflcWit#%  iftf fllVn  stations   on  a  request 


MMSffiff' 


492 


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■UM  mromwta  co..  mc 
J07  C  itxtn.  N  E  2  5 

Vaikiafno.  O  C     20002 
<20])M«-4«M 


UNCLASSIHED 


486 


basis,,  was  put  up  on.  the  satellite,  and  has  been  used  as  a 
"leave  behind"  with  organizations,  television  stations,  when 
speakers  spoke  to  either  of  those. 

Q    Do  you  know  whether  air  time  was  purchased  for 
"Bitter  Legacy"  on  television  stations? 

A    I  don't  ever  recall  purchasing  time  on  television 
stations  for  "Bitter  Legacy. "   We  did  put  it  up  on  the 
satellite,  and  you  pay  for  the  satellite  time,  but  then  the 
stations  take  it  and  it  is  up  to  them  to  air  it,  or  not. 

Q    But  you're  not  aware  of  it  being  aired  as  a  paid 
program? 

A    I  don't  recall  it  ever  being  aired  as  a  paid 
program. 

Q    Do  you  recall  it  ever  being  aired  as  a  public- 
service  program? 

A    Some  of  the  television  stations  who  interviewed 
some  of  the  speakers  did  use  it,  subsequently,  as  a  public- 
affairs  program. 

Q    Public-affairs  program.   Turning,  Mr.  Miller,  to 
page  27  which  concerns  the  IC  account  in  the  Cayman  Islands, 
there  is  a  reference  to  a  receipt  in  July  of  1986  of  $55,753. 
Do  you  see  that? 

A    Yes. 

Q    Are  you  aware  that  the  IC  account  received  such  an 
amount  at  approximately  that  time? 


UNCLASSIHED 


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W7  C  SflRl.  N  I.  25 

Variwirao.  DC.    20001 
(202)  M64<M 


UNCLASSIFIED 


487 


No. 


I  think  your  record's. incorrect.   I  think 


that's  an  inter4account  transfer  which  you're  attributing  to 
an  outside  source. 

Q    Now  our  analysis  indicates  that  the  IC  account 
received  funds  from  Herbert  Barness,  the  Heritage  Foundation, 
IBC,  NEPL,  and  interest  payments.   Are  you  aware  of  any 
sources  of  funds  to  the  IC  account  other  than  the  sources  I 
just  indicated? 

A   ,  No. 

Q    It's  your  belief  that  the  entry  on  this  sheet, 

dated  July  31,  1986,  for  $55,753,  should  be  an  entry  for  an 

inter4account  transfer? 
> 
A    Correct . 

Q         When  you  refer  to  " interfaccount  transfers,"  what  cy 
you  mean? 

A    The  managing  directors  in  the  Cayman  Islands  set  up 
additional  accounts  in  order  to  draw  interest  without  our 
direction.   They  simply  took  it  upon  themselves  to  do  it,  and 
when  we  would  require  transfers  to  be  made  out,  sometimes 
they  would  have  to  accumulate  the  sum  in  one  of  the  accounts 
and  they  did  that  by  transferring  the  amounts  from  other 
accounts.  And  I' believe  your  entire  bottom  section  probably 
is  redundant  to  tiie.lJSQ  ^egt^n.  __So^'m  very  dubious  about 
your  analysis . 

Q    Turning,  again,  to  page  32,  we've  talked  earlier 


494 


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UNCLASSIFIED 


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507  C  Soto.  N  E 
WuhuftDn.  DC     20002 


today  about  the  indication  of  a  payment  from  Miller  Communica- 
tions to  Kate  Macinnis  in  March  of  1986  for  $31,663.00. 

I  believe  you  indicated  that  that  was  for  some 
purpose  other  than  a  direct  payment  to  Kate  Macinnis. 

A    That's  correct. 

Q    I  believe  it  was  for  a  purchase  of  a  cashier's 
check  or  a  treasurer's  check,  or  some  other  sort  of  transfer. 
Is  that  correct? 

A    Some  other  form  of  transfer.   That's  correct. 

Q    Do  you  have  any  recollection  of  a  payment  or  a 
transfer  in  that  amount  from  Miller  Communications  in  March 
of  19867 

A    No. 

Q  If  you  will  turn  to  page  33,  there  is  an  indication 
of  a  transfer  from  Miller  Communications  to  the  National  Bank 
of  Washington  in  December  1986  of  $64,791.04. 

Do  you  recall  a  transfer  in  that  approximate 
amount,  or  a  payment  in  that  approximate  amount  in  December 
1986? 

A    Again,  I'm  sure  it  was  for  some  instrument  of  some 
sort,  but  I  don't  specifically  recall.   It  could  have  well 
been  year-end  draw.   Something  that  will  cheer  the  IRS. 

Q    Now  going  back  to  page  four  of  this  exhibit, 
there's  an  indication,  Mr.  Miller,  that  in  1985  and  1986 — 

le  total  figure  combined  for  1985  and  1986? 


495 


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■ujii  MMMma  CO,  ne. 
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WatMfwi,  DC  nan 


UNCUSSIHED 


489 


Q    For  1985  and  1986,  yes.   This  analysis  covers 
January  1985  through  December  1986,  and  it  indicates  payments 
to  IBC  from  NEPL  of  $5,037,751,101 

Is  it  your  recollection  that  in  that  two-year 
period/  IBC  received  payments  from  NEPL  in  the  approximate 
amount  of  $5  million? 

A    I  can't  attest  to  that  figure  without  going  back  and 
looking  at  my  business  records. 

Q   'I'm  not  asking  you  to  attest  to  that  figure.  -  My 
question  is,  is  it  your  recollection  that  in  that  two-year 
period,  the  total  payments  to  IBC  from  NEPL  were  approximately 
$5  million? 

-  A    Approximately  $5  million,  yes. 

g    Is  that  correct?  That's  your  recollection? 

A    Yes. 

Q    Now,  in  addition,  page  four  indicates  that  IBC 
received  a  payment  from  the  Western  Goals  Foundation  of 
$6^762,  which  we  discussed  earlier  today,  and  you  indicated 
that  you  recall  a  payment  in  approximately  that  amount  from 
Western  Goals,  is  that  correct? 

A    Tes. 

Q    Page  four  also  indicates  that  IBC  received  payments 
from  the  American  Conservative  Trust  of  $11,440.   Is  it  your 
recollection  that  in  this  two-year  period,  IBC  received 
payments  from  the  American  Conservative  Trust  in  approximately 


mmvm 


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.  D  C      20002 


wmsm 


490 


that  amount,  of  $11,4407 

A    I  don't  specifically  recall  the  amount,  but  I  recall! 
receiving  compensation  in  rough  approximation  of  that  figure. 

Q    From  the  American  Conservative  Trust? 

A    Yes. 

Q    There's  also  an  indication  here  of  receipts  by  IBC 
of  $21,000  from  the  Palmer  National  Bank.   Do  you  recall  any 
receipts  from  the  Palmer  National  Bank,  or  do  you  have  any 
explanatidn  of — well,  let  me  leave  the  question.   Do  you 
recall  any  receipts  in  the  range  of  $21,000  from  the  Palmer 
National  Bank? 

A    Not  from  the  Palmer  National  Bank.   That  would  have 
been  money  from  the  National  Endowment  for  the  Preservation 
of  Liberty. 

MR.  PRECUP:   Mr.  Fryman,  before  you  leave  page 
four,  I  would  like  it  noted  for  the  record/  I  have  a  strong 
objection  to  the  indication  of  the  words  "income"  on  this 
page  because  it  is  not  consistent  at  all  with  Mr.  Miller's 
testimony  nor  with  the  records  themselves,  or,  I  think  the 
facts,  that  that  is  income  in  any  income  tax,  or  even 
financial  sense.   It  may  have  been  receipts.   But  the  income 
characterization  is  wholly  improper  and  without  foundation. 

MR.  FRYMAN:   Well,  Mr.  Precup,  I'm  not  asking  that 
Mr.  Miller  adopt  this  exhibit  in  any  way,  and  in  the  prepara- 
tion of  this  exhibit,  T  Ji  hi"  l_ljnki#«i>'<nil  our  accountants 


miMi^^trnn' 


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laXfN  «M0IIT1N0  CO..  MC 
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Wuhaainon.  O  C.    20001 


IK5P 


USSIFIED 


491 


intended  to  suggest  by  the  word  "income"  that  the  amounts  in 
that  column  were  taxable  income. 

I  think  the  word  on  the  cover  page,  in  analysis  3A 
is  "receipts "yi and  I  think  what  you're  saying  is  that  you 
would  have  preferred  that  the  word  "receipts"  be  used  on  page 
four  as  well. 

Is  that  correct? 

MR.  PRECUP:   Well,  I  didn't  say  that.   I  said  I 
objected  to  the  use  of  the  word  "income." 

MR.  FRYMAN:   Well,  your  objection  is  noted. 

MR.  PRECUP:   Thank  you. 

MR.  FRYMAN:  As  I  say,  I'm  not  asking  you  or  your 
client  to  accept  the  characterization,  and  there  is  not  any 
intent  in  preparing  this  to  suggest  that  these  amounts  were 
taxable  income. 

MR.  PRECUP:  Thank  you,  Mr.  Fryman. 

BY  MR.  FRYMAN: 
Q    Mr.  Miller,  in  Exhibit  29,  there  is  a  reference  in 
several  places — and  to  take  an  example,  page  7  of  Exhibit  29- 
-to  Carlos  Ulet,  U-l-e-t.   Do  you  recall  a  payment  to  an 
individual  by  that  name? 

A    Yes.   But  it's  incorrectly  reported  as  Ulet. 
Q    what  is  the  correct  spelling? 
A    It's  pronounced  Ulvert,  and  it's  u-1-v-e-r-t. 
Q    Who  is  Carlos  Ulvert? 


yiisussinED 


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Vuhjnftoa.  O  C.    20002 


BKWSSlflHl 


492 


A  .  He  is  th«— or  was  the  executive  dl^nctor- .and 
Washington  representative  of  UNO,  Unified  Nlcaraguan  Opposi- 
tion. 

MR.  FRYMAN t   Off  the  record. 
[Discussion  off  the  record.] 

MR.  FRYMAN:   I  ask  the  reporter  to  mark  as  Miller 
Deposition  Exhibit  30,  a  composite  exhibit  composed  of  a 
group  of  pages  produced  by  counsel  for  Mr.  Miller,  and  IBC. 

(The  document  referred  to  was 
marked  Miller  Deposition  Exhibit 
No.  30  for  identification.] 
MR.  FRYMAN:   The  first  three  pages  of  this  exhibit 
is  a  handwritten  inventory  of  the  materials  Included  in  the 
exhibit,  identifying,  where  possible,  the  date  of  the 
document,  and  the  control  number  of  the  document,  placed  on 

the  document  by  counsel  for  IBC,  and  Mr.  Miller. 

■? 
MR.  PRECUP:  Those  are  our  control  numbers. 

MR.  FRYMAN:   They're  your  control  numbers. 

MR.  PRECUP i  Thank  you. 

[ Pause . ] 

BY  MR.  FRYMAN: 
Q    Mr.  Miller,  I  show  you  Deposition  Exhibit  30  for 
identification.   Mr.  Miller,  if  you  *rould  first  look  at  the 
documents  included  in  Exhibit  30,  which  begin  with  your 


control  number  1377.   It' 

I 


mm 


cal  event  checklist 


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Mtxin  WMOwrwtt  co..  hc 
V)7CScn«.  NE  25 

Waihiaftoo.  DC     20002 


yanssifiED 


493 


dated. .March  1,  1985.  There  then  follows,  beginning  at  your 
document  number  1357,  a  chronological  event  checklist  dated 
March  15,  1985. 

After  that,  there  is  a  chronological  event  checklist 
dated  March  20,  1985  which  begins  with  your  control  number 
1368. 

Then  at  page  1385,  there  is  a  document  headed 
"Congressional/Public  Affairs/Diplomatic  Action  Plan." 

•MR.  PRECUP:   Mr.  Fryman,  Just  a  moment  here.   We 
seem  to  have  a  page  or  two  missing.   The  previous  chronologi- 
cal checklist  that  you  identified  was  our  control  number 
1368,  March  20,  1985. 

That  appears,  on  our  copy,  to  be  a  two-page 
document.   It  is  followed  by  control  number  136 — and  obliter- 
ated—  I  think  it's  probably  1369,  that  starts  on  page  two  and 
continues.   So  its  dates  appear  not  consecutive  with  those  of 
its  preceding  pages,  and  we  may  be  missing  a  cover  sheet. 

MR.  FRYMAN:   Mr.  Precup,  I  believe  you  are  correct. 

MR.  PRECUP:   Is  your  copy  the  same  way? 

MR.  FRYMAN:   It  is. 

MR.  PRECUP:   The  document  to  which  I  just  referred 
beginning  on  what  appears  to  be  1369,  continues  through 
serial  number  page  9,  and  then  you  just,  if  I  recall  correct- 
ly, directed  our  attention  to  1385. 

MR.  FRYMAN:  Xss .  ^Tid  Af^ mwmimnes   through  your 


TiMi^iK^onm' 


500 


M7  C  Stmt.  N  ( 
Vailuifaa.  0  C.    OKI 


wmvm 


494 


control  number  L376., .. 

MR.  PRECUP:  Okay.  The  one  that  begins,  yes,  on 
page  two . 

MR.  FRYMAN:   On  page  two. 

MR.  PRECUP:   All  right.   Fine. 

MR.  FRYMAN:   There  may  be  missing,  in  this  exhibit, 
the  first  page  of  that  document. 

Then,  at  page  1385,  as  your  control  number,  as  I 
indicated;  there's  a  document  headed  'Congressional/Public 
Affairs/Diplomatic  Action  Plan." 

MR.  PRECUP:   Hay  I  ask  about  that  document,  Mr. 
Fryman,  please.   Ours  is  marked  "confidential."  There's  no 
indication  of  a  removal  of  a  security — 

MR.  FRYMAN:  Mr.  Precup,  that  was  as  produced  by 
you. 

Then,  beginning  at  your  control  number  1389, 
there's  a  document  dated  April  17,  1985,  headed  "Calendar  of 
Events  Regarding  Nicaraguan  Resistance,"  which  appears  to  be 
a  t%ro-page  document,  and  finally,  at  your  control  number  page 
1391,  there  is  a  document  dated  ^ril  16,  1985,  which  is 
headed  "The  208  Group." 

On  each  of  these  documents,  where  there  is  a 
confidential  stamp,  that  stamp  was  on  the  document  when  it 
was  produced  your  firm,  as  counsel  for  Mr.  Miller  and  IBC. 

"  - :—  OlLASSIRFn 


501 


)07  C  Strttt.  N  E 
Vukuftoci.  D  C      20002 


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495 


Q    Now  the  documents  that  I  have  just  identified,  Mr. 
Miller,  do  you  recognize  those  documents?   Have  you  seen  them 
before? 

A    I've  seen  them  before. 

Q    Where  did  you  obtain  those  documents?  And  if  you 
obtained  them  from  different  sources,  would  you  identify  the 
source  for  each.   If  you  obtained  them  all  from  the  same 
source,  if  you  would  just  identify  the  one  source. 

A    I  can't  tell  you  specifically  who  provided  me  with 
them.   I  believe  they  all  came  from  the  same  source  and  it  was 
probably  Jonathan  Miller  at  State  Department,  or  possibly 
Oliver  North,  but  I  don't  ever  remember  Ollie  North  giving  me 
copies  of  a  document  like  this. 

Q    Did  you  ever  discuss  these  documents,  or  any  of 
these  documents  with  Oliver  North? 

A    I  don't  remember  a  specific  discussion  with  Oliver 
North  about  these  documents . 

Q    Did  you  ever  discuss  these  documents  with  Jonathan 
Miller? 

A    Again,  I  don't  have  a  specific  recollection  of 
discussing  them  with  Jonathan  Miller. 

Q    Is  it  your  best  recollection  that  you  obtained 
these  documents  from  Jonathan  Miller? 

A    It's  my  best  recollection  that  I  got  them  from 
either  Jonathan  Miller  or  Olivet  Nprt, 


or  Olivet  North '^^Lf^ag ,  and  I  don't 


502 


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50?  C  Smn.  N  E  25 

Waihinitoo.  0  C     20001 
(2021  Hi'."- 


UNCliSSlFIED 


496 


remember  specifically  who  gave  them  to  us. 

Q    Do  you  know  who  prepared  these  documents? 

A    No.   I  don't. 

Q    Do  you  know  if  Pat  Buchanan  had  any  role  in 
preparing  these  documents? 

A    I  don't  know  who  prepared  them.   I'm  not  aware  of 
any  role  by  Pat  Buchanan. 

Q    Did  you  ever  discuss  these  documents  with  Pat 
Buchanan? . 

A    I  don't  think  so. 

Q    Did  you  ever  meet  with  Pat  Buchanan? 

A    I've  met  him  one  time,  I  think. 

Q    That  meeting  had  nothing  to  do  with  these  documents? 

A    No. 

Q    What  did  you  understand  was  the  purpose  of  these 
documents  ? 

A    They  were  a  reflection  of  events  taking  place  in 
Washington,  in  the  United  States,  that  impacted  on  the 
Congressional  vote  for  aid  to  the  freedom  fighters. 

Q    Now,  on  the  first  page  of  this  group  of  documents, 
the  chronological  event  checklist  dated  March  1,  1985,  which 
has  your  control  number  1377,  at  the  top,  under  the  "Respon- 
sibility" column,  there  is  a  reference,  "State/LPD,"  and  then 
parentheses,  (Miller),  close  parentheses. 

Now,  in  March  of  1985,  were  you  and  your  company. 


503 


MT  C  SiRR.  N.E. 
WMhMffun.  DC 


1 
,2 
3 
4 
5 

6 
7 
8 
9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 


OftCUSSiFIED 


497 


IBC,  performing  services  for  the  State  Departmeat  pursuant  ta 
a  contract? 

A    Yes. 

Q    Was  that  contract  with  the  LPD  office  of  the  State 
Department? 

A    Yes. 

Q    Now  was  it  your  understanding,  that  the  reference 
to  Miller  in  the  "Responsibility"  column  under  State/LPD,  was 
a  reference  to  you? 

A    No. 

Q    Who  did  you  understand  that  referred  to? 

A    Jonathan  Miller. 

Q    What  was  the  reason  you  believed  that  referred  to 
Jonathan  Miller  instead  of  yourself? 

A    Because  in  other  locations  where  our  company  was 
referenced,  they  usually  put  Gomez  as  opposed  to  putting 
Miller,  and  a  couple  of  these  things  that  are  attributed  to 
Jonathan  Miller,  we  did  not  have  any  involvement  in,  such  as 
the  very  first  one  on  the  list. 

We  didn't  send  out  the  resource  book  on  Contadora. 
That  was  done  by  somebody  other  than  us. 

Q    So,  then,  as  an  example  on  the  next  page,  1378,  at 
the  bottom  of  the  page,  again  in  the  'Responsibility"  column, 
there  is  a  reference  to  State/LPO,  and  under  that,  paren, 

at  you  just 


(Gomez),  close  paren.   Is  that  an  exa 


504 


art498 

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23 

24 

MiUn  ROOHTWQ  COn  HC 
M7CS<RR.  NE  25 

Waikiatioa.  DC.    n00> 


Oi 


lED 


498 


referred  to,  of  an  indication  of  actions  to  be  taken  by  IBC 
and  Mr.  Gomez,  and  you,  pursuant  to  your  contract  with  the 
State  Department? 

A    Well,  it's  action  taken  by  Mr.  Gomez.   I'm  not  sure 
that  is  activity  expected  under  the  State  Department  contract. 
As  you  can  see,  in  that  same  entry  it  also  talks  about  Dan 
Kuykendall  and  Dan  Kuykendall  was  not  a  contractor  for  the 
State  Department. 

'  There  are  many  other  people  in  this  document  that 
are  in  no  way  connected  to  the  Federal  Government.  So  this 
document  seems  to  have  relied  on  a  number  of  people  outside 
government  to  also  take  certain  actions . 

Q    So  the  reference  to  Gomez  on  page  1378  is  unclear 
in  your  mind,  whether  that's  a  reference  to  your  duties  under 
the  State  Department  contract? 

A    Actually,  no,  I  would  say  it's  quite  clear  in  my 
mind,  that  we  did  not  set  up  the  Bermudas,  Tegrio,  and  Mike 
Liiga  news  conference — although  I  don't  even  remember  Mike. 
Mike  Lima  was  not  at  the  news  conference — on  behalf  of  the 
State  Department.   That  was  done  with  Dan  Kuykendall,  the 
Gulf  and  Caribbean  Foundation. 

Q    Would  you  look  through  these  pages  and  point  out  to 
me  an  example  of  the  sort  of  entry  you  referred  to  where 
there  is  a  reference  to  Gomez,  and  that  means  work  under  the 
IBC  contract  with  the  State  Department 


mmm 


nt 


m\ 


505 


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luLXMK  nrom—a  co..  hc 
507  c  Sow.  N  E.  25 


wussra 


499 


MR.  PRECUP:   If  there  is  one. 
[Pause. ] 

THE  WITNESS:   On  page  1380,  at  the  very  bottom, 
there's  a  reference  to  a  Pentecostal  minister,  who  name  is 
Vallardo  Antonio  Santeliz,  and  he  was  somebody  that  Frank 
Gomez  provided  escort  services  for,  and  for  whom  we  set  up 
some  press  interviews. 

BY  MR.  FRYMAN: 

Q    -That  was  work  you  were  doing  pursuant  to  the  State 
Department  contract? 

A    Yes. 

Q    Now  in  that  entry,  there's  also  a  reference  to  Mr. 
Kuykendall,  who  you  indicated  earlier  you  did  not  believe  was 
working  pursuant  to  a  government  contract. 

Do  you  have  any  understanding  as  to  why  Mr. 
Kuykendall  is  referred  to  in  that  sane  entry? 

A    Yes.   In  our  contract,  we  would  try  and  find  an 
org.anization  to  sponsor  these  refugees  or  these  atrocity 
victims,  and  in  this  case,  the  Gulf  and  Caribbean  Foundation 
agreed  to  sponsor  this  individual. 

Q    All  right. 

A    On  page  1381,  there  is  a  reference  to  Miller/Gomez 
for  Pedro  Juaquin  Chamorro — misspelled — editor  of  "La  Prensa" 
for  a  U.S.  media  and  speaking  tour,  and  that  was  an  activity 
handled  under  our  State  Department  contract ^^^jri'j  alV%  '' ^- 


506 


artSOO 

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24 

uuMD  npunTwa  CO-  we 

MTCSuni.  NL  25 

WHtunfm.  DC    lOon 


wmsw 


SCO 


Q    Now  did  you  understand  the  reference  to  Miller  in 
that  entry  to  be  a  reference  to  you  or  to  Jonathan  Miller? 

A    Jonathan  Miller.   I  don't  think  there  are  any 
references  to  me,  personally,  in  this  document. 

Q    Now,  at  this  time  in  198S,  what  was  Jonathan 
Miller's  position? 

A    I  believe  he  was  still  the  deputy  director  of  the 
Office  for  Public  Diplomacy. 

Q   '  He  was  an  employee  of  the  State  Department?  - 

A    I  believe  that's  correct,  yes.  Did  you  want  me  to 
continue? 

Q    No.   You've  answered  my  question.   Do  you  know  why, 
Mr.  Miller,  that  Jonathan  Miller,  as  an  employee  of  the  State 
Department,  would  be  distributing  a  document,  which  at  page 
1383  have  your  control  numbers — refers  to  the  beginning  of  a 
"targeted  telephone  campaign"  in  120  Congressional  districts, 
for  Citizens  for  America,  district  activists,  organize  a 
phgne  tree  to  targeted  Congressional  offices,  encouraging 
them  to  vote  for  aid  to  the  freedom  fighters  in  Nicaragua. 
MR .  PRECUP  >   Excuse'  me ,  Mr .  Fryman .   Did  you  say 
why  Jonathan  Miller  would  have  been  undertaking  that? 

MR.  FRYMAN i   I  think  the  question  was  do  you  know 
why. 

MR.    PRECUP t     Well,   but  I  don't  see  Mr.   Miller's 
name  on  this   pages ■vwUtfim|p#)A4:^|C'\n  the  antecedent  of 


"iiwr.mwtfn 


507 


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2 

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5 

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8 

9 

10 

H 

12 

13 

14 

15 

16 

17 

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20 

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22 

23 

24 

ICO..  MC 

25 


fflLASSIFIED 


501 


your  question  there.   Why  do  you  put  in  your  question  Jonathan 
Miller,  when  I  don't  see  his  name  on  the  page? 

MR.  FRYMAN:   Well,  Mr.  Richard  Miller  indicated  that 
he  believed  this  document  had  been  distributed  to  him  by 
Jonathan  Miller.  ! 

MR.  PRECUP:   Oh,  I  think  his  testimony  was  not 
quite  that.   I  think  he  said  it  was  given  to  him  by  one  of  twol 
people,  or  one  or  two  offices,  and  he  wasn't  sure  which.   Mr. 
Abramoff's  name  appears  on  this  event  list  on  page  1383,  not 
that  of  Miller,  Jonathan  or  otherwise. 

MR.  FRYMAN:   Well,  that's  true,  Mr.  Precup.         | 

Let  me  ask  some  further  questions . 

BY  MR.  FRYMAN: 
Q    Is  it  your  understanding  that  Jonathan  Miller  had 
any  responsibility  for  the  preparation  of  this  chronological 
event  checklist  that  we're  discussing? 
A    I  believe  he  did,  yes. 
_   Q    All  right.   Now  let  me  now  ask  the  question  that  I 
asked  a  minute  ago.   Do  you  have  any  understanding  as  to  why 
Jonathan  Miller,  as  an  employee  of  the  State  Department, 
included  in  this  checklist  the  item  with  regard  to  a  targeted 
telephone  campaign  that  appears  on  1383? 

A    I  have  no  idea  why  he  included  it. 


Q    Did  you  ever  discuss  that  with  Jiiffl?, 
A    No . 


llfulJ^OOi 


508 


art502 


ica.  Mc 

Mr  C  ImR.  N.L     2  5 
a.  0  C  uoei 


umssra 


502 


Q  Did  it.  surprise  you  to  see  that  item  on  a  docxunent 
that  you  understood  was  prepared  by  an  employee  of  the  State 
Department? 

A    I  don't  remember  being  surprised. 

Q         Mr.  Miller,  turning  to  your  control  number  page 
1391,  which  is  the  April  16,  1985  sheet  headed  "208  Group," 
what  was  the  208  Group? 

A    I'm  not  really  sure. 

Q    >Was  that  a  phrase  that  you  ever  used  in  conversa- 
tions at  this  time? 

A    No.   The  only  time  I  ever  heard  it  was  one  day  Fawn 
Hall  used  it.  And  I  said  who's  that,  and  she  ticked  off  a 
whole  bunch  of  names,  about  seven  or  eight  of  them,  and  I 
remember  I  wrote  them  do%ni.   In  fact,  I  produced  that  piece 
of  paper  to  you.   It  was  Will  Ball  and  some  other  folks. 

Q    Do  you  know  why  your  files  contained  pages  such  as 
page  1368  and  the  pages  following  that,  which  is  the  March 
20^  1985,  chronological  event  checklist,  which  have  a 
confidential  stamp  on  thera? 
( Pause ) 

A    I  have  no  particular  explanation  as  to  why.   They 
simply  were  provided  to  us. 

Q    And  you  believe  that  was  by  Jonathan  Miller? 

A    Again,  I  believe  it  was  by  one  of  two  offices, 
either  Jonathan  Miller 'A  ptfXoi  fiSi^Uti.ir«ii»W«nh '  s  office. 


509 


_  1 

2 

3 

4 

5 

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9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 
iMLLiii  RcraimNa  co..  mc. 

507C5trcn,  NE  2  5 

WuhiflfTPP.  p  '*.    zcm 


UNCUSSIHED 


503 


I  also  notice  that  there  is  on  1385  what  seems  to 
be  an  indication  about  declassifying.   I  don't  know  whether 
that  means  these  were  declassified  or  whether  this  is  the 
office  in  charge  of  declassification. 

Q    And  following  that  are  the  initial  OADR? 

A    Yes. 

Q    Do  you  know  what  that  refers  to? 

A    No. 

Q    Turning  in  this  exhibit,  Mr.  Miller,  to  the 
document  that  has  your  identification  No.  2433  and  2434, 
which  is  a  memorandum  for  Mr.  Robert  C.  McFarlane  of  the 
White  House  —  and  this  is  a  document  that  has  been  discussed 
to  some  extent  previously  in  this  deposition  —  that  is  a 
document  that  you  prepared,  is  it  not? 

A    It  is  a  document  which  I  contributed  to  in  a  large 
percentage,  and  I  believe  by  telephone,  if  I  recall  correctly. 

Q    Tou  mean  you  dictated  it  over  the  telephone? 
_  A    Yes,  I  think  that  was  the  way  it  was  done. 

Q    Who  did  you  dictate  it  to? 

A    I  don't  remember.   I  think  it  was  somebody  over  at 
the  State  Department. 

Q    In  Jonathan  Miller's  office? 

A    I  believe  so. 

Q    And  the  second  page,  headed  "Contributions,"  did 
you  also  dictate  that  information? 


immm 


510 


MS504 

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24 

muB>  ■oumwu  eo..  me. 

507  C  Sam.  N  E  25 

VHhiniRoa.  D  C     >mol 


504 


A    Yes. 

Q    And  the  handwriting  on  that  page,  is  that  your 
handwriting? 

A    Yes. 

Q  Do  you  know  how  you  happened  to  receive  a  copy  of 
this  document  back  for  your  files  if  you  dictated  it  to  Mr. 
Miller's  office,  Mr.  Jonathan  Miller's  office? 

A    Well,  I  think  that  you  see  is  a  draft  copy  which 
came  to  m4,  and  I  subsequently  made  recommended  changes)  and 
I  don't  think  I  have  the  final  copy  in  my  file. 

Q  What  did  you  do  with  the  copy  after  you  made  the 
recommended  changes?  Did  you  transmit  the  revised  copy  to 
anyone? 

A    I'm  sure  I  did,  but  again  I  don't  remember  who 
specifically  it  was.   But  I  think  it  was  whoever  I  dictated 
the  original  document  to. 

Q    So  you  believe  you  sent  it  to  Jonathan  Miller? 
-  A    Again  my  recollection  isn't  complete  on  this.   But 
I  think  that's  the  office  that  was  handling  this.   And  I 
can't  remember  the  individual  who  I  was  dealing  with  over  the 
telephone. 

Q    Would  you  have  sent  this  to  Oliver  North? 

A    That's  possible. 

Q  Now,  there's  a  reference  in  the  memorandxim  to  a^ 
meeting  on  Tuesday,  June  25,  or  Thursday 


ihe   memorandum  to  a      , 

■DNetussw 


511 


505 


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24 

WUDI  ROONTwa  CO..  MC 
WT  C  Sil«i.  N  E.  25 

Wuhiognxi.  D  C.    Z0002 


umss'ffl 


Is  that  June  of  1985? 

A    That  is  correct. 

Q    And  would  this  memorandum  have  been  prepared  by  you 
a  few  weeks  prior  to  that,  or  in  early  June  or  in  May  of  1985? 

A    Yes. 

Q    Why  did  you  believe  it  was  appropriate  for  the 
Department  of  State  to  request  a  Presidential  meeting  with 
Mrs.  Newington?   Because  she  had  made  substantial  contribu- 
tions to  programs  designed  to  support  the  policies  of  Ronald 
Reagan? 

A    Well,  her  contributions  went  beyond  just  supporting 
policy.   It  included  a  large  number  of  political  and  humani- 
tarian gifts  as  well.   Any  one  of  those  I  feel  would  have 
qualified  her  for  the  appointment.   In  fact,  we  found  it  sort 
of  extraordinary  that  she  hadn't  been  to  meet  the  President 
prior  to  this . 

If  you  go  into  the  Roosevelt  Room,  the  paintings 
tha£  hang  on  the  wall,  and  if  you  go  into  the  family  quarters, 
the  paintings  that  hang  on  the  wall,  millions  of  dollars 
worth  of  paintings  were  given  years  ago  by  she  and  her 
husband.   So  she  has  been  a  long-time  supporter  of  the  United 
States  Government,  and  has  given  both  to  political  and 
humanitarian  activities.   And  so,  for  those  reasons,  she 
deserved  an  opportunity  to  meet  the  President. 

Q    But,  in  this  memora 


'mii^inctifrtii' 


512 


MS506 

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24 
■ujR  iVFoirtMa  CO- MC. 

M7  C  Sam.  N.E.  25 

Wuhoicna.  DC.    MOOl 


itmssw 


506 


request  by  the  Department  of  State  for  a  Presidential  meeting 
with  Mrs.  Newington  is  described  to  be  the  contributions  that 
are  attached  to  the  mefflorandum,  is  it  not? 

A    That's  correct. 

Q    And  my  question  to  you  is  why  did  you  believe  that 
it  was  appropriate  for  the  Department  of  State  to  recommend  a 
Presidential  meeting  on  the  basis  of  these  contributions? 

A    Well,  it  is,  as  I  understand  it,  fairly  standard 
practice  for  agencies  and  departments,  the  senior  staff  in 
those  agencies  and  departments  to  recommend  people  to  meet 
both  the  President  and  the  Vice  President  and  other  in- 
dividuals when  they  deserve  some  recognition  as  citizens. 
And  that's  exactly  what  was  happening  here. 

Q  Turning  to  the  page  with  your  Control  No.  3572, 
which  is  a  calendar  for  August  26,  1985,  do  you  recognize 
that  calendar? 

A    Yes. 

Q    Are  the  notations  on  that  calendar  in  your  handwrit- 
ing? 

A    Yea. 

Q    Now,  there's  a  reference  on  August  26th  to  a 
meeting  with  Roy  Godson  at  10:30. 

Do  you  see  that  reference? 

A    Yes . 

Q    Do  you  recall  what  that  meeting  involved? 


UNCLASSIFIED 


513 


507  C  SoMt.  N  i. 

Wuhinfion.  DC     2000} 


wmssra 


507 


A    Ye«.   I  testified  earlier  that  this  meeting  was  to 
discuss  a  grant  from,  at  that  point,  unknown  to  me,  a 
contributor  who  turned  out  to  be  the  Heritage  Foundation. 

Q    Was  that  a  meeting  that  you  had  at  Mr.  Godson's 
office? 

A    That's  correct. 

Q    What  does  17  30  RI  refer  to? 

A    That's  Rhode  Island  Avenue. 

Q    . Is  that  the  address  of  his  office? 

A    Yes. 

Q    And  is  601  the  office  number? 

A    Yes. 

Q    Was  this  the  first  time  you  had  met  Mr.  Godson? 

A  I  believe  so,  but  I'm  not  certain  of  it.  I  had  two 
meetings  with  him  in  his  office,  and  I  don't  know  whether  the 
second  was  recorded  in  my  notebook  or  not. 

Q    But  other  than  the  two  meetings  with  respect  to 
this  matter,  you  had  not  previously  meet  Mr.  Godson? 

A    No. 

Q         Who  put  you  in  touch  with  Mr.  Godson? 

A    Oliver  North. 

Q    Did  he  tell  you  that  Mr.  Godson  would  be  calling 


you? 


I  honestly  don't  remember  how  it  was  left,  but  we 

o   I   don't   know 


were   to  have  a  phone  conversation   rin  iiiin  4  iiilin 


514 


MS508 

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10 

H 

12 

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22 

23 

24 

■ujii  Hvonima  CO..  mc 
>07  C  Sum.  N  E  25 

Vaihiiif<oa.  O  C     20002 


yiLASSinED 


508 


who  called  who. 

Q    Turning  to  the  next  page,  which  is  3120  is  your 
control  number,  and  it's  a  memo  to  you  and  Frank  Gomez,  dated 
September  30,  1985,  from  Dan  Conrad,  there's  some  handwriting 
on  that  sheet. 

Whose  handwriting  is  that? 

A    Mine . 

Q    There  are  various  requirements  for  the  month  of 
October  described  in  that  memorandum,  including  an  RR  letter 
to  Barbara  Newington  and  an  RR  meeting  with  Barbara  Newington, 
and  an  RR  meeting  with  Bunker  Hunt,  Ellen  Garwood,  Fred 
Sacher,  and  the  Warms.  After  that,  you  have  written  the  word 
" green . " 

what  does  the  word  "green"  refer  to  there? 

A    Colonel  North. 

Q    And  does  that  mean  that  Colonel  North  was  to 
arrange  those  items? 

A    No.   It  meant  that  I  wanted  to  —  it  was  a  mental 
note  to  myself  to  talk  to  Colonel  North  about  it. 

Q    Did  you? 

A    Without  a  subsequent  checkmark  and  hashmark  through 
it  on  this  page,  I  don't  see  any  indication  I  did.   If  there 
was  a  phone  conversation  with  him  or  a  meeting  in  which  it 
was  discussed,  it  would  appear  some  place  else,  and  itwould, 
probably  be  one  of  those  marks  through  i 


:e  else,  and  it  would   _. 


515 


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2 

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8 

9 

10 

11 

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19 

20 

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22 

23 

24 
■nun  ftroKma  co..  mc. 

>07CSam.  NE  25 

Vuhinfnxi.  DC     20002 


509 


I  think  this  is  just  my  reacting  to  Dan  Conrad  as 
he  was  explaining  the  things  on  my  list,  and  my  thinking 
about  who  I  would  go  to  see  about  it . 

Q    So  when  they  asked  for  a  letter  or  a  meeting  with 
President  Reagan  at  this  point  in  September  of  1985,  it 
occurred  to  you  that  Colonel  North  was  the  person  you  would 
go  to  to  arrange  such  a  letter  or  meeting? 

A    Well,  that,  and  I  would  never  undertake  to  have  a 
meeting  like  that  without  letting  Colonel  North  know  that  we 
were  doing  it.   It  would  have  been  folly  for  us  to  do  that. 
Q    Well,  was  the  notation  here  merely  that  you  were 
going  to  notify  him  that  you  were  going  to  try  to  do  this,  or 
was  it  a  notation  to  indicate  that  you  were  going  to  attempt 
to  arrange  these  events  through  him? 

A    I  think  those  are  only  notations  that  I  intended  to 
discuss  it  with  him.   I  don't  think  it  indicates  that  I  was 
going  to  ask  his  assistance  or  just  inform  him,  but  that  I 
waft  intending  to  discuss  it  with  him. 

Q    At  this  point  in  time  in  September  of  1985,  whom 
would  you  contact  to  try  to  arrange  a  meeting  with  President 
Reagan  for  Barbara  Newington? 

A    I  might  have  contacted  the  Public  Liaison  Office  or 

the  Political  Office? 

Q    Who? 

A    John  Roberts,  Lynus  Cochelus.   In  fact,  some  of  the 


ilASSIRM 


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Wuluiiftoo.  D  C     20001 


UHClASSinEO 


510 


briefings  that  we  set  up  were  set  up  through  the  Public 
Liaison  Office  or  through  the  Political  Affairs  Office. 

Q    Are  these  briefings  with  President  Reagan? 

A    The  initial  briefing  with  President  Reagan,  the 
recononendations  began  in  the  Public  Liaison  Office. 

Q    When  you  refer  to  the  initial  briefing  with 
President  Reagan,  to  what  are  you  referring? 

A    January  27th,  I  think  it  was,  1986. 

Q    Could  that  have  been  January  30,  1986? 

A    30,  you're  right,  30. 

Q    Now,  is  it  not  true  that  David  Fischer  had  a  role 
in  arranging  that  briefing? 

A    He  did.   But  again  I  think  the  original  formal 
request  started  also  in  Public  Liaison. 

Q    But  is  it  your  understanding  that  David  Fischer  was 
the  person  who  was  responsible  for  arranging  that  briefing? 

A    He  had  principal  responsibility  for  it. 

Q    Now,  before  David  Fischer  was  involved  with  your 
organization,  who  had  the  principal  responsibility  for 
attempting  to  arrange  meetings  with  President  Reagan? 

A    There  was  a  shared  responsibility  between  Mr.  Gomez 
and  myself.   I'm  sorry,  I  reacted  wrong  to  your  question, 
because  I  didn't  hear  you  drop  President  Reagan  at  the  end  of 
your  question. 

If  your  ijiHiiULHJ-  1  I  ■!  Itl.  Jl^lfHTTI  i  I  ^as  a  shared 


'mfM'K^«;ff!?n 


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(Wit  muwM 


Kussra 


511 


responsibility.   The  only  other  meeting  we-  attempted  to  get 
for  the  President  was  the  Barbara  Newington  meeting,  and  I 
had  responsibility  for  that  memorandum. 

Q    And  with  whom  did  you  arrange  that  meeting?  You 
mentioned  Jonathan  Miller. 

A    Again,  I've  forgotten  who  exactly  we  gave  the 
original  text  to.   But  I  believe  the  memorandum  came  out  of 
the  State  Department  and  went  to  Robert  McFarlane,  and  then 
was  signed  off  by  people  within  the  National  Security  Council. 

Q    Did  you  seek  the  assistance  of  Colonel  North  in 
arranging  that  meeting  with  Barbara  Newington? 

A    He  was  aware  of  it,  yes. 

Q    But  did  you  also  seek  his  assistance  and  support 
with  respect  to  that  meeting? 

A    Yes . 

Q         Now,    turning  to  the  next  page  in  this  composite 
exhibit,   Mr.   Miller,  which  has  your  Cffi@|^^HBf462i9Pne 
writiit^psoa^rinting  appears  on  that  page? 

A         Mine. 

Q    Did  you  draft  this  letter? 

A    Yes,  I  did. 

Q    And  then  if  you  will  look  at  the  subsequent  pages, 
2887  through  2889,  those  are  letters  dated  December  17,  1985, 
from  Oliver  North  to  Frank  Darling^t^n,;_(lS.lvin  Salwasser  and 
Bill  Bush. 


518 


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IHU.IR  nromnn  co..  mc. 

>07  C  Stren.  N  E  25 

WuhiD«nxi.  DC     20002 
12021  ^*6-UU 


BNWSSIFIED 


512 


Now,  those  Letters . -appear  to  be- the  text  that  you 
drafted  at  4462,  is  that  correct? 

A    That's  correct. 

Q    Did  you  send  that  text  to  Colonel  North  for  him  to 
send  those  three  letters? 

A    I  sent  him  that  as  a  recommended  text  and  these 
names  and  addresses.   And  I  believe  it's  not  completely 
identical.   I  think  he  changed  it  to  suit  his  needs  and 
signed  them  and  sent  them  to  the  people. 

Q    What  were  the  changes  that  Colonel  North  made? 

A    I  think  he  left  out  the  word  "Nicaragua"  after  the 
word  "democracy"  in  what  was  my  final  sentence.   And  he  put 
"may  God  bless"  in  the  body  of  the  letter  and  used  "Sincerely" 
as  the  salutation. 


He  basically  adopted  the  text  you  proposed,  did  he 


not? 


Yes. 


And  then  he  sent  you  copies  of  the  letters? 

Yes.   Actually  Fawn  Hall  sent  them  to  me. 

Now  turning,  Mr.  Miller,  to  the  document  with  your 
Control  No.  beginning  2665  through  2687,  which  was  a  series 
of  letters  from  Colonel  North,  dated  January  24,  1986. 

Did  you  draft  the  text  of  those  letters? 
A    Basically,  yes. 


At  page  2 


im^RFS' 


s  an  address  list 


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and  an  indixration  of  the  proper  salutation  for.  the  letter. 
Were  those  pages  prepared  by  your  office? 
A    I'm  not  sure  whether  the  salutation  and  address 
pages  were  prepared  by  our  office,  but  they  were  certainly 
supplied  to  Colonel  North  either  through  us  or  directly  by 
NEPL.   I've  forgotten  which. 

Q    They  were  prepared  either  by  you  or  by  Mr.  Chan- 
nel's office? 

A    • Correct . 

Q    And  you  drafted  the  letter? 

A    Yes. 

Q    What  was  the  procedure  for  arranging  for  Colonel 
North  to  send  this  letter? 

A    I  either  met  with  him  or  had  a  conversation  with 
him  about  the  need  to  send  a  thank  you  to  the  people  involved 
in  the  NEPL  efforts.   And  he  agreed,  if  I  would  give  him  a 
draft,  that  he  would  send  them  thank  you  letters,  which  he 
did. 

Q    And  then  he  sent  you  copies? 

A    Yes. 

Q    What  was  the  need  to  send  letters  to  these  in- 
dividuals, as  you  understood? 

A    They  were  people  who  had  contributed  to  the  public 
education  program  of  <C!>iiiuiiUi(!i%  Endowment  for  Preservation  of 


Liberty,  and  were  being  r< 


and  were  ^^Ji9^§60§§i-9^ 


for  that  contribution. 


520 


MS514 

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UNCLASSIFIED 


514 


Q  Was  another  purpose  o£  this  letter  to  prepare  thejn 
for  a  further  solicitation  by  Mr.  Channell's  organization? 

A    That  wasn't  my  purpose  when  I  asked  for  them.   They 
were  simply  recognition  of  contributions  to  the  public 
education  effort. 

Q    What  did  you  mean  by  the  phrase,  and  I'm  assuming 
that  you  wrote  this  phrase,  but  if  you  did  not,  correct  me, 
in  the  last  paragraph,  or  in  the  next  to  the  last  paragraph 
of  the  letter  which  states,  "In  the  weeks  ahead,  we  will 
commence  a  renewed  effort  to  make  our  assistance  to  the 
Democratic  Resistance  Forces  even  more  effective.   Once 
again,  your  support  will  be  essential." 

Did  you  draft  that  phrase  or  those  sentences? 

A    I  don't  recall  whether  that  was  specifically  in  my 
draft  that  I  sent  to  Colonel  North.   But,  in  general^J*gg»  I 
think  it  refers  to  the  coming  political  debate  associated 
with  assistance  to  the  f^reedom  fighters . 

Q  Were  these  individuals  that  you  knew  were  going  to 
be  invited  to  the  briefing  at  the  White  House  on  January  30, 
19867 

A    It's  a  different  year.   I'm  sorry,  you're  right, 
you're  absolutely  right.   I'm  sorry. 

No,  I  don't  think  that  was  the  intended  purpose  of 
it. 

Q    Did  you  expect  tji^x  X^Sfib^idd' vidua  Is  would  be 


521 


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mjLOt  WMOITWO  CO..  MC 
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Tuhintmtl.  P  r     21X10] 


IBitlASSW 


515 


solicited,  again  by  Mr.  Channell  for  the  Central  American 
Freedom  Program  which  was  getting  underway  in  January  of  1986? 

A    I'm  not  being  flippant.   Don't  misunderstand  me. 
Of  course.   I  don't  know  one  fund  raiser  that  doesn't  go  back 
and  solicit  contributors  time  and  time  again,  depending  on 
whether  they  provide  money  for  a  program  prior  to  it,  and 
that's  standard  operating  procedure  for  political  organiza- 
tions and  fund  raisers. 

Q    Turning  back,  Mr.  Miller,  to  the  two  pages  in  ■ 
advance  of  the  first  of  the  January  24,  1986,  letters,  which 
are  pages  15026  and  15027,  do  you  recognize  those  pages? 

A    Yes. 

Q    Where  did  you  get  those  pages? 

A    From  Citizens  for  America,  I  believe. 

Q    Do  you  recall  when  you  got  them? 

A    Yes .   We  used  to  go  and  attend  the  general  strategy 
sessions  held  either  by  Colonel  Sam  Dickens  over  at  the 
American  Security  Council,  or  by  Dan  Kuykendall.   And  in  each 
of  those  meetings,  the  Citizens  for  America  people  would  hand 
out  an  updated  list  of  their  Congressional  targets. 

Q    What  representative  of  Citizens  for  America  would 
hand  out  this  list,  or  a  list  such  as  this? 

A    Peter  ri^iiic^  I  think  was  the  one  I  remember. 


There  may  have  been  others . 
Q 


iTCjWi5^(*Tflrn 


a  the  group  that  was  headed 


522 


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UNCLASSIFIED 


516 


by  Lew- Lehman?  —         -  - 

A    Yea .   I  would  mention  also  that  there  was  ray 
handwriting  on  this  list,  and  what  that  is  is  a  reflection  of 
a  discussion  with  Dan  Kuykendall  where,  in  some  cases,  he 
didn't  agree  with  their  characterization  of  people  as  targets 
or.   And  sometimes  I  would  take  their  list  and  compare  it 
with  what  knowledge  Dan  Kuykendall  had,  and  I  think  that's 
the  note  you  see  on  it. 

Q   .  At  pages  53034  through  53036,  there  are  documents 
relating  to  the  Heritage  Foundation  grant  which  we've 
discussed  today,  and  which  Mr.  Kaplan  has  questioned  you 
about  at  a  previous  session. 

This  list  of  gran^  was  it  not,  that  was  the 
subject  of  your  meetings  with  Mr.  Godson? 

A    Yes . 

Q    Did  Mr.  Godson  tell  you  that  he  had  been  asked  by 
Colonel  North  to  raise  funds  ford 


A    Mo,  I  don't  think  specifically  I've  been  told  that. 

Q    What  did  he  tell  you? 

A    He  told  me  that  he  had  a  contributor  who  wanted  to 
give  money  to  the  Democratic  Bfeslstance,  and  that  they  did 
not  want  to  give  money  to  Mr.  Channell  specifically.   And  I 
came  away  from  my  meetings  with  him  with  the  sense  that  this 
contributor  was^logi^ing  ^o^cQv^dfidDoney  to  political 


nWi^iwirir' 


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■taun  utromwa  co..  mc 

507  C  Sirett.  N  E  25 

Tuhiofioa.  D  C      20002 


wmvm 

omDatlve  segments  of  the  ( 


517 


entitxea  and  the  non^comBative  segments  of  the  opposition. 
Non-f combatant,  I  should  say,  segments. 

Q    Colonel  North  asked  you  to  meet  with  Mr.  Godson, 
did  he  not? 

A    Yes. 

Q    And  did  you  understand  your  role  with  respect  to 
the  funds  being  raised  by  Mr.  Godson  was  to  provide  vehicle 
for  receipt  of  the  funds? 

A    That's  correct. 

Q    Did  you  discuss  with  Mr.  Godson  two  alternative 
vehicles,  one  being  the  Cayman  Islands  bank  account,  and  the 
second  being  the  Institute  for  North-South  Issues? 

A    I  remember  discussing  the  Institute  because  that's 
what  I  later  recommended  to  him.   I  remember  discussing  Mr. 
Channell,  and  I  may  have  told  him  that  somebody  could  give  a 
contribution  directly. 

Q    To  the  Cayman  Islands  account? 

A    I  don't  recall  where  I  told  him,  but  I  may  have 
said  that  somebody  could  have  given  a  contribution  directly. 

Q    Now,  is  it  correct  that,  at  a  later  point,  Mr. 
Godson  had  a  discussion  with  you  about  using  the  Heritage 
Foundation  as  a  vehicle  for  the  contribution? 

A    I  don't  recall  a  subsequent  conversation,  although 
I  may  have  called  him  and  somewhat  surprised  at  the  correspon- 
dence I  receJc;nll4W>  k^A  Atff^^l^Ilou'^^^^lon  asking  for  a 


'  rtTMnra^!siFiFr 


524 


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24 

■uj*  Rvotrrwa  CO..  mc. 
W7  C  Smtt.  N  E  25 

VuluBlioii.  O  C      2000} 
•:-"  ""MM 


518 


grant.   I  don't  think  I  left  his  office  knowing  that  it  was 
the  Heritage  Foundation. 

Q    Is  it  your  recollection  that  the  first  knowledge 
you  had  of  the  involvement  of  the  Heritage  Foundation  was  the 
receipt  of  a  letter  from  the  Heritage  Foundation? 

A    That's  my  recollection,  yes. 

Q    After  receiving  that  letter,  did  you  then  have  a 
conversation  with  Mr.  Godson? 

A    ,As  I  said  a  moment  ago,  I  don't  remember  a  specific 
conversation.   But  I  have  a  sketchy  recollection  of  calling 
to  express  some  surprise  at  the  letter  from  the  Heritage 
Foundation. 

Q    Did  you  have  a  discussion  of  this  letter  from  the 
Heritage  Foundation  with  Colonel  North? 

A    I  don't  recall  whether  I  did  or  not. 

Q    Did  you  ever  discuss  in  any  way  with  Colonel  North 
the  use  of  the  Heritage  Foundation  for  transferring  contribu- 
tions to  entities  associated  with  Nicaragua? 

A    I  don't  recall  having  such  a  conversation  with  him. 

Q    Did  you  have  a  conversation  with  Dr.  Edwin  Feulmer, 
F-e-u-1-m-e-r,  about  a  grant  from  the  Heritage  Foundation? 

A    If  I  did,  I  don't  recall  it.   I  don't  recall  having 
a  conversation  with  him  about  it. 

Q    On  your  file  memorandum,  dated  December  1,  1986, 
which  is  your  0<i4M>flVt  VRCftHi'H  41^  memorandum  which  you 


""WJEsra* 


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WrCSoin.  NE  25 

VaiburM.  D  C     2000] 


519 


OHCLASSIFIED 


prepared,  is  it  not? 

A    Yes . 

Q    In  the  first  paragraph,  you  state  that  the  grant 
was  provided  to  INSI  at  the  request  of  the  National  Strategy- 
Information  Center. 

How  did  you  learn  that? 

A    That's  Mr.  Godson's  organization. 

Q    Yes .   But  who  informed  you  that  the  Heritage 
Foundation  grant  had  been  provided  to  INSI  at  the  request  of 
the  National  Strategy  Information  Center?      -^^ 

MR.  PRECUP:   He  just  answered  that,  Mr.  Fryman. 
THE  WITNESS:   Yes.   I  don't  know  how  else  to  answer 
it.   Mr.  Godson  was  the  head  of  the  National  Strategy 
Information  Center.   I  went  to  see  him  about  the  grant,  and 
subsequent  correspondence  came  from  the  Heritage  Foundation. 
BY  MR.  FRYMANS 

Q    Well,  in  your  initial  conversation  with  Mr.  Godson, 
there  is  no  mention  of  the  Heritage  Foundation,  is  that 
correct? 

A    Right . 

Q    Then  you  got  a  letter  from  the  Heritage  Foundation  • 

A    Right. 

Q    —  talking  about  a  grant. 

Now,  I'm  not  clear  from  your  testimony  that  after 

mm'  sooinrn 


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iMuoi  Mwjwmq  co..  mc. 
107  C  Scren.  N  E.  25 

VuhiofTon.  O  C     20002 
(2021  •" 


m  & 


520 


the  receipt  of  the  letter  from  the  Heritage  Foundation,  you 
had  any  further  communication  with  Mr.  Godson. 

A    Well,  I'm  not  clear  in  my  recollection  about 
whether  I  had  any  subsequent  conversation  with  Mr.  Godson 
about  it.   But  I  seem  to  recall  calling  Mr.  Godson  and 
expressing  some  surprise  about  the  Heritage  Foundation  letter. 

So  I  think  that  statement  that  you  just  read,  the 
grant  was  provided  to  INSI  at  the  request  of  another  50103 
organization,  is  in  keeping  with  what  I  just  told  you.. 

Q    So  it's  your  belief  that  —  your  basis  for  that 
statement  as  a  conversation  with  Mr.  Godson  after  you  got  the 
letter  from  the  Heritage  Foundation,  is  that  correct? 

A    Yes. 

Q    That's  what  I  was  trying  to  clarify. 

Now,  in  the  third  paragraph,  you  state  that  INSI 
retained  a  20  percent  administration  fee  for  its  distribution 
of  this  grant.   And  you  go  on,  all  other  expenditures,  and 
the  memorandum  reads  where,  but  I  think  that's  a  typographical 
error,  I  think  it  should  read  were  — 

A    Correct . 

Q    —  made  through  Latin  American  nonprofit  organiza- 
tions . 

And  the  paragraph  earlier  refers  to  an  investigation 
and  analysis  of  information  available  to  international  news 
organizations . 


iformation  available  to  ir 

UNCLASSIFIED 


527 


1" 


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■un  mmhtmo  CO..  MC 

MTCJami.N.1.  25 

VakiHioa.  DC    MOOl 


What  other  Latin  American. nonprofit  organisations 

were  making  expenditures  in  connection  with  this  grant? 

A    Well,  anybody  involved  in  the  Nicaraguan  Resistance 
is  a  nonprofit  organization.  And  anyone  involved  ^i^^^lH 
UH|Bor  the  Democratic /Ilesistance  political  entities  is  a 
nonprofit  organization.   So  I  would  have  viewed  any  of  those 
entities  as  nonprofit. 

Q    Did  you  understand  there  was  an  investigation  and 
analysis  of  information  available  to  international  nevrs 
organizations  that  was  being  undertaken  as  a  result  of  this 
grant? 

A    I  would  say  that  that  is  a  simplification  of  what  I 
thought  the  money  was  to  be  used  for,  and  that  as  for  the 
generation  of  news  reports  and  information  on  political 
activities  by  those  organizations. 

Q    Nhat  do  you  mean  by  the  generation  of  news  reports 
by  those  organizations? 

A    Nell,  any  political  entity  or  human  rights  organiza- 
tion or  entity  associated  with  a  political  movement  that 
najgi^eii/  communicate  with  the  public  and  the  world  at  large. 
And  they  do  that  through  the  media. 

Q    Mr.  Miller,  in  this  composite  exhibit,  a  group  of 
telephone  messages  begins  at  the  page  with  your  Document 
Control  No.  3133. 

0«  di^t%^|a V  jVlV^!^!^T^<'^"  ^°  y°^  i'o^   ^awn  — 


ifl(jmoT^?^n' 


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■ujn  mromma  co..  ttc. 

507  C  Sum.  N  E  2  5 

Wuhiatno.  D  C.    10002 


522 


3131. 


yNCLASSIFlEO 


Q    3131,  I'm  sorry. 

—  dated  9/17,  which  states  give  her  a  call  re  a 
Texas  based  group  called  Freedom's  Friends.   She  wants  you  to 
do  a  little  background  check  on  them  for  Ollie. 

Did  you  understand  this  message  came  from  Fawn  Hall? 
A    Yes. 

Q    Do  you  recall  this  message? 
A   • Yes . 
Q    What  did  you  understand  you  were  being  asked  to  do 


here? 


tion. 


To  find  out  whether  this  was  a  legitimate  organiza- 


Q    How  would  you  go  about  doing  that? 

A    Calling  friends  and  associates.   I  don't  think  I 
did  anything  with  this  one  though. 

Q    Did  you  consider  this  an  unusual  request  by  Fawn 
Hall  on  behalf  of  Oliver  North? 

A    No. 

Q    Did  you  receive  similar  requests  on  other  occasions? 

A    Yes. 

Q  Turning  to  the  next  page,    3149,    there   is   a  message 

to  you   from  Fawn,    dated  4/9,    which  says   has   package  which 
must  be   picked  up  today,    and  it  continues   regarding  AAA 
meeting  tomorsvi, ■  liCU  ^ti<3iiXtL  JifQKi^J^on 


mm  mmti' 


igh  Bob  Ma^n. 


529 


MS523 


i07  C  Siittt.  N  E 
Vuhiofton.  O  C      20002 


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CO..  MC. 

25 


sussro 


523 


Do  you  recall  receiving  that  message? 

A    Not  specifically,  but  it's  got  my  hashmark  through 
it  and  that's  what  I  do  with  my  phone  messages  when  I  read 
them.   So  that  means  I  looked  at  it  or  acted  on  it. 

Q    Do  you  believe  the  date  of  this  message  was  April 
9,  1986? 

A    I'm  really  not  sure. 

Q         Who  was   Bob  kmSmta? 

A 

the  State  Department  in  '86  but  not  in  '85,  so  it  would  have 
to  be  1986. 

Q    Well,  what  was  his  position  in  the  State  Department 
in  1986 
A 


Oh,  it  would  have  to  be  1986,  because  -iU^^^was  in 


A 


t/ 


He  was  originally  a  deputy  to  Elliot/Abrams, 
actually  an  assistant  to  Ellioj^^rams,  and  then  became  the 
Coordinator  of  the  Office  of  Public  Diplomacy. 

Q    Now,  what  does  the  AAA  meeting  refer  to? 
.  A    Adolf o  Calero,  Arturo  Cruz  and  Alfonso  Robelo,  and 
it  probably  had  to  do  with  meeting  the  President.   I  can't 
recall  whether  there  was  a  meeting  on  that  date  or  not,  or  on 
or  about  that  date. 

Q    And  is  that  an  example  of  an  activity  that  you 
would  work  with  Mr.  ToJgon  on? 

A    No,  not  generally.   This  again  doesn't  bring  to 
mind  any  sp^cjj i<^^ct^^^^t^f^.f  wtm^  tke   only  other  time  I  met 


WMItj^imrff 


530 


MSS24 

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W  C  Jam.  N  I.  2  5 

~itlMi DC  aooi 


UNCLASSIFIED 


S24 


with.  Mr.  K<i«g«n  on  Msiatanca  leaders  was  to.  discuss-some 
politics  associated  with  the  leadership  and  a  subsequent 
meeting  I  have  already  recounted  to  you  in  previous  testimony 
for  the  establishment  of  an  Uno  Office. 

Q    Do  you  recall  what  the  package  referred  to  in  this 
message  is? 

A    No,  I  don't  remember. 

Q    Turning  to  the  next  page,  which  is  3161,  there  is  a 
message  again  from  Favm,  which  states  that  Fawn  received  a 
message  that  a  Huck  Walter  in  Staunton  ^^^^^^^^B  ^"  looking 
for  a  contra  to  'pressure  his  district.*  Fawn  doesn't  know 
if  Staunton  is  Virginia  or  not. 

Do  you  recall  that  message? 

A    Yes,  I  think  so. 

Q    What  did  you  understand  pressure  his  district 
referred  to? 

A    As  I  recall,  this  gentleman  wanted  a  contra  to  come 
in  and  condemn  his  opponent.  And  we  turned  him   down. 

Q    Did  you  understand  Mr.  Walter  was  a  candidate  for 
Congress? 

A    I've  forgotten  whether  he  was  the  candidate  or 
whether  he  was  working  for  a  candidate.   But  he  was  quite 


angry  with  me. 


Why  did  you  turn  him  down? 
Because  it  was  inappropriat 


«msw 


531 


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mxa  nrotrma  co..  mc. 

iOTCSoKt.  NE  25 

Wiihuifton.  D  C      20002 
:202l  Mt'MM 


wussife 


525 


Q  Why? 

A    It  was  inappropriate  to  have  contra  leaders 
interjecting  themselves  into  elections.   It's  not  proper 
behavior.   None  of  them  would  have  done  it  either. 

Q    Turning  to  the  next  page,  there  is  an  indication  of 
a  telephone  message  on  February  28th  from  Martin  Artiano, 
saying  that  he  called  from  Jamaica  to  see  how  the  meeting 
with  Barbara  Newington  went  yesterday,   will  call  back  later. 

Do  you  know  why  Mr.  Artiano  was  calling  you  from 
Jamaica  to  see  how  the  Newington  meeting  went? 

A    No.   I  assume  it  was  just  general  interest  in  Mrs. 
Newington 's  meeting. 

Q    Was  that  a  meeting  with  President  Reagan? 
A    I  believe  it  was.   She  had  two  meetings  with  the 
President. 

Q    You're  not  aware  of  any  additional  information  as 
to  the  reason  for  Mr.  Artiano 's  call? 

.  A    I  think  it  was  just  professional  curiosity.   He  was 
just  keeping  together  with  the  effort. 

Q    On  the  next  page,  Mr.  Miller,  there's  a  phone 
message  from  Roy  Godson  on  December  5,  which  states  needs 
information  urgently.   He's  leaving  for  Europe  tomorrow. 
Do  you  know  what  that  refers  to? 
A    It  seems  to  me  that  this  was  in  reference  to  the 
Barness  check.   I  think  that's  correct 


532 


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MT  C  Una.  N.I.      2  5 
T^kHuaa.  DC.  lOOOt 


s 


526 


Q  ..  What  was  the  information  that  he  needed  urgently? 

A    I  think  he  needed  to  know  who  to  have  Mr.  Barness 
make  it  out  to. 

Q    And  did  you  convey  that  information  to  Mr.  Godson? 

A    I  don't  recall  whether  I  did  or  not.   It  may  have 
been  that  the  check  was  simply  left  blank. 

Q    Is  it  your  recollection  that  the  information  that 
he  needed  urgently  was  unrelated  to  his  European  trip? 

A   ' I  don't  remember  it  being  related  to  his  European 
trip.   But  I  don't  remember  the  specifics  of  this  anyway.   So 
I  can't  specifically  remember. 

Q    Do  you  recall  ever  providing  any  information  to  Mr. 
Godson  that  was  related  to  a  trip  he  was  making  to  Europe  or 
for  him  to  use  during  an  European  trip? 

A    I  don't  recall.   If  you  give  me  more  specifics, 
I'll  try  to,  but  I  don't  recall  providing  him  information  for 
a  trip  to  Europe. 

Q    Are  you  aware  of  any  fund  raising  efforts  ever 
undertaken  by  Mr.  Godson  to  raise  money  in  Europe  for 
[related  to  Nicaragua? 

A    No. 

Q    Turning  to  page  3250,  there's  a  phone  message  from 
Ibrahim,  I-b-r-a-h-i-m,  which  states  he  is  on  his  way  to 
Frankfurt,  everything  is  all  right,. will  take  care  of  telefax 
Do  you  recall  receiving  tl 


«1«1FI[D 


533 


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Decemb< 

W7  C  Stren.  N  E               2  5 

Q 

Wuhinpoo   DC      2000 J 

527 


Vaguely. 

Who  is  Ibrahim? 

al-Massoudi. 

Are  you  sure  of  that? 

Positive. 

What  was  the  trip  to  Frankfurt  that's  referred  to 


A 

Q 
A 

Q 

A 

Q 
there? 

A    He  was  dealing  with  a  connnodities  broker  in 
Frankfurt'  on  his  oil  transaction,  and  I  believe  the  telefax 
refers  to  some  information  that  I  had  requested  he  send  me  to 
try  and  verify  this  whole  transaction. 

Q    Turning  to  the  next  page,  3255,  there  is  a  reference 

6 

to  a  telephone  message  from  Mr.  topp  of  Switzerland. 
Do  you  recall  receiving  that  message? 
A    Yes,  and  that's  the  one  I  testified  to  earlier  that 
when  he  called  me  back,  I  missed  the  phone  call,  and  subse- 
quently got  it,  got  another  call. 

C 
At  that  time,  did  you  know  who  Mr.  ^opp  was? 

No. 

Did  you  later  learn? 

Yes. 

How  did  you  learn? 

I  think  it  was  in  a  Washington  Post  article  in 

December  of  this  past  year. 

Until  then  you  did  not  know  the  identity  of  Mr. 

mm  Rccinrn 


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mjjii  nrvmivta  co..  mc. 

507  C  Sum.  N  E  2  5 

Wuhmpon.  D  C     20002 


c 

^opp? 


UNCLASSIHED 


528 


And,  based  on  that,  whom  do  you  believe  Mr.  ^opp 


A    NO.   In  fact,  you  know  it  was  the  Tower  Conunission 
report  was  the  first  time  I  saw  it. 

Q 
was? 

A    Ai^irai  Secord. 

Q    Mr.  Miller,  directing  your  attention  to  the  first 
page  of  handwritten  notes  in  Composite  Exhibit  30,  which  has 
your  Control  No.  1723,  there's  an  item  there  that  reads  • 
present  him  with  a  check,  arriving  late  tonight,  John  Ramsey, 
$25,000. 

Is  that  in  your  handwriting? 

A    Yes. 

Q    Do  you  recall  when  you  made  those  notes? 

A    Not  the  specific  date,  but  sometime  early  spring  of 
1985. 

Q    What  do  those  notes  refer  to? 

A    I  think  it's  a  conversation  with  Spitz  ChannelJ^and 
John  Ramsey  was  making  a  $25,000  contribution. 

Q    And  when  you  say  present  him  with  a  check,  what 
does  the  "him"  refer  to? 

A    I  can't  remember  which  him  it  is,  whether  it's 
Channell's  organization  or  Mr.  Calero. 

Q    And  it's  Ramsex  utft%% tf^VflH^P?  late  tonight 

A    Yes 


mmw 


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muMK  m^imimi  co..  hc. 
WTCSinn.  NE.  25 

Vaihiafaa.  DC     :aOO] 


UNCUSSIFIEO 


529 


Q    And  he's  going  to  present  the  contribution  of 
S25,000  tonight? 

A    I  believe  that's  correct. 

Q    Turning  to  page  1735,  are  those  notes  in  your 
handwriting? 

A    Yes. 

Q    Do  you  recall  when  you  made  those  notes? 

A    I  was  —  I  can  recall  where  I  made  them.   I  believe 
it  was  May  or  June  at  al-Massoudi's  residence  in  Fresno, 
California. 

Q    May  or  June  of  1985? 

A    Correct. 

Q    Are  these  notes  of  a  conversation  with  al-Massoudi? 

A    These  are  all  things  that  al-Massoudi  had  told  me 
and  that  I  had  also  put  a  brainstorm  on. 

Q    Now,  on  No.  8  appears  to  be  a  name.   What  is  that 


A    Gordon  Brown. 

Q    Who  is  that? 

A    I  don't  know.   Somebody  al-Massoudi  said  he  knew. 

Q    No.  9  appears  to  be  the  name  William  Sullivan.   Do 
you  know  who  that  refers  to? 

A    This  was  supposed  to  be  the  Ambassador  —  he 
claimed  that  that  was  the  U.S.  Ambassador  to  Iran  during  the 
revolution,  and_th£t^  hf  Jj^^gggf^^ationship  with  him. 


u#rii^^iinrff 


53 


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Hum  nromwta  co..  hc 
W7  C  Sinn.  N  E.  2  5 

Wuhiofna.  D.C.    :oao] 


-  Q    There's  also  a  reference  to  Michael  Ledeen  in 
there.   Do  you  know  why  there's  a  reference  to  Michael  Ledeen? 

A    That  was  my  idea,  to  call  Michael  and  try  and  see 
what  he  knew  about  it . 

Q    How  did  you  know  Michael  Ledeen? 
A    I  met  Michael  as  a  Gulf  and  Caribbean  scholar  in 
1984,  I  believe  it  was. 

Q    Does  this  page  of  notes  refer  to  efforts  to  release 
the  hostages? 
A    Yes. 

Q    Why  did  it  occur  to  you  to  contact  Michael  Ledeen 
on  that  subject? 

A    Because  what  I  was  trying  to  do  was  get  some  Middle 
Eastern  history  at  the  tigie"  of  the  Islamic  revolution  in 
Iran.   And  1  had  heard  Michael  speak  about  it  before,  and  he 
seemed  to  be  knowledgeable. 

Q    Turning  to  the  next  page,  which  is  page  1772,  there 
appears  to  be  a  reference  to  the  situation  room  and  Room  208. 
Do  you  see  those  references  at  the  bottom? 
Yes. 

Is  that  in  your  handwriting? 
Yes. 

What  do  they  refer  to? 
Briefings .      v ;  .  '  •:  -   -,  :-.  .-.  •  .;   .  -.- 
About  what?      ,  'i  r  ■•  iVv'^'i  >-  i   '  \ 


537 


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HUJM  WtWJWIIWO  CO.,  MC. 
lOr  C  Sueet.  N  E  25 

Vislunron.  D  C      20001 


l)NCLilSSIf|[D 


531 


A   .  Ceatral  America,  ta  be  given  by  Colonel  North. 

Q    And  was  one  briefing  to  be  in  the  situation  room 
and  another  in  Room  208? 

A    No.   I  think  what  happened  here  was  that  Mr. 
Channeli  wanted  it  in  the  situation  room  and  it  was  held  in 
Room  208.   And  I  think  it's  the  same  date,  the  18th  and  the 
18th. 

Q    And  this  is  a  group  briefing  for  Mr.  Channeli 's 
contributors? 

A    That's  correct. 

Q    Do  you  recall  the  date  of  this  briefing? 

A    Not  specifically.   I  thought  there  was  more  than 
one  in  Room  208. 

Q    Now,  there's  a  series  of  notes  above  those  ref- 
erences that  are  very  vague,  but  there  appears  to  be  the  word 

MR.  PRECUP:   Is  that  faint? 
MR.  FRYMAN:   Very  faint,  yes. 
BY  MR.  FRYMAN: 
Q    There  appears  to  be  the  word  Facel.   Do  you  see 
that? 

A    Yes,  but  I  can't  tell  what  the  rest  of  it  says. 
Oh,  I  know  what  this  says.   Mr.  Channeli  wanted  to  see  if  he 
could  see  Chairman  Fascell  and  his  Board  of  Directors 
MR.  FRYMAN:   Off  the  record 


mm 


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M?  C  SoRi.  N  E.  25 

Vl*a>|tmi.  DC.    20002 


MPMm 


532 


(Discussion  off  the  record.) 
BY  MR.  FRYMANi 
Q    Can  you  tell  what  the  rest  of  the  notes  are  there? 
A    I  just  remembered  that,  because  I  have  recently 
seen  the  original  piece  of  paper  in  another  setting.   But  I 
can't  remember  what  the  —  I  think  I  told  him  that  he  was  too 
controversial  and  basically  that  it  wasn't  probably  a  good 
idea  to  ask. 

Anyway,  I  didn't  see  no  checks  or  hashmarks  so  I 
didn't  take  any  action. 

Q    Turning  to  the  next  page,  which  is  1780,  is  that  in 
your  handwriting? 
A    Yes. 

Q    There's  a  note,  Barbara  Newington  appointment 
before  July  14th,  $1  million. 

What  is  the  basis  for  that  note? 
A    I  think  this  entire  page  is  a  reflection  of  still 
outstanding  assignments  from  Mr.  Channell.   And  that  was 
something  that  he  wanted. 

g    Well,  what  do  you  understand  the  appointment  with 
Barbara  Newington  to  involve? 

Was  this  again  a  reference  to  a  meeting  with 
President  Reagan? 


I  don't  recall  whether  it  was  President  Reagan  or 


Colonel  North. 


539 


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■UIOI  MPOWmU  CO..  HC 
)07  C  Sum.  N  E.  2  5 


533 


Q    What  do  you  understand  the  reference  to  SI  million 
on  that  sheet  to  be? 

A     I  don't  have  a  specific  recollection  of  what  it's 
tied  to.   Whether  it  was  something  she  already  gave  or 
whether  it  was  something  she  was  going  to  give.   I  don't 
recall. 

Q    There's  a  further  reference  to  a  phone  tapping  firm 
in  Connecticut. 

Do  you  know  what  that  refers  to? 

A    Yes .   Mrs .  Newington  was  very  uncomfortable  having 
the  Soviets  in  her  neighborhood,  and  she  attributed  the  death 
of  Larry  McDonald  to  the  Soviet  Union  in  a  purposeful  way. 
And  she  didn't  feel  very  secure,  and  she  asked  Mr.  Channell  to 
find  a  firm  that  could  check  her  phones  for  taps.   And  Mr. 
Channell  asked  us  to  do  it. 

Q    What  do  you  mean  that  she  was  uncomfortable  with 
the  Soviets  in  her  neighborhood? 

Was  it  your  understanding  that  there  was  a  Soviet 
residence  near  the  residence  of  Mrs.  Newington? 

A    There's  something  right  there  in  her  neighborhood. 
I'm  not  quite  sure  what  it  is. 

Q    Did  you  arrange  for  some  measures  to  be  taken  to 
assure  that  Mrs.  ^%^f>f ?^^ ' % Q|'l°Api W^jpil'S^  being  tapped? 

Q    Turni.ng  to  page  3196,  are  those  notes  in  your 


540 


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W  C  StfWl.  N  E.  2  5 


534 


h£mdwritln9?  .       . 

A         Yes. 

Q         Now,  there's  a  reference  on  that  page  to  a  spark  to 
Houston. 

Does  spark  refer  to  Mr.  Calero? 

A    Yes. 

Q    There's  also  a  reference  to  Copa,  C-o-p-a. 
Do  you  know  what  that  refers  to? 

A   '  I  believe  that's  an  airline. 

Q    Do  you  know  the  name  of  the  airline? 

A    No. 

Q    And  there's  a  reference  to| 
Do  you  know  what  that  is? 

A    I  believe  that's  the  hotel  he  was  staying  in. 

Q    Where  was  that? 

A    I  don't  remember  specifically.   I  looks  like  a 

lumber  with  six  digits,  but  I'm  not  sure 
of  that. 

Q    Now,  also  on  that  page,  there's  a  reference  to 
Urick,  U-r-i-c-k  and  what  appears  to  be  Tussif,  Y-u-s-s-i-f . 
Do  you  see  those  references? 

A    Tea. 

Q    Do  you  know  what  those  references  referred  to? 

A    They  are  notes  from  a  conversation  with  al-Massoudi, 
but  beyond  that  l_doQ.'t  have  gnv  specific  recollections, 


\m\  m'irwti 


541 


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HUJR  mromwta  co,  nc 

507  C  Siren.  N.E  25 

Wuhuitoo.  O  C     20002 


mmmii 


535 


Q    Do  they  have  any  relationship  to  your  involvement 
on  issues  relating  to  Nicaragua? 

A    I  don't  recall.   I  don't  remember  the  name  Hans 
Urick,  and  I  don't  have  a  specific  recollection  of  that,  no. 

Q    Would  you  read  that  section  of  the  notes  for  the 
record,  beginning  is  it  one  Urick,  U-r-i-c-k? 

A    That's  correct. 

Q    And  then  would  you  just  continue? 

A    It  says,  Hans  Urick-Danish.   No.  2  is  available. 
Yusiff  offered  by.   No.  3  is  100,000  tons  gas-oil. 

Q    Is  it  your  recollection  that  those  three  items  are 
related,  or  do  you  know  if  they're  related? 

A    I  don't  have  a  specific  recollection  about  the 
first  item.   The  other  two  I'm  sure  are  al-Massoudi  items. 
But  what  they  mean  I  don't  have  any  specific  recollections. 

Q    Turning  to  the  next  page,  and  your  identification 
nuo^r  is  not  clear  on  that  page,  but  the  page  begins \272, 000 
Mewington . 

Is  that  page  in  your  handwriting? 

A    Yes. 

Q    Do  you  recall  making  these  notes? 

A    Yes. 

Q    What  was  the  circumstances  under  which  you  made 
these  notes ^ 


'  iiillASSiflFIl 


542 


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mum  mnmiwta  eo.,  hc 
S07  C  Sotn.  N.E  2  5 

Vuhiniian.  DC.    20002 


?vgf^! 


iSSIFlEO 


536 


A  It  was  a  telephone  conversation  with  Mr.  Channell. 
It  may  have  been  a  meeting,  but  anyway  it  was  a  conversation 
with  Mr.  Channell. 

Q  Do  you  recall  approximately  when  this  conversation 
occurred? 

A    No.   Sometime  in  '86. 

Q    Now,  at  the  top,  it  appears  to  read  §272,000 
Newington,  and  then  you're  subtracting  $40,000  for  ACT  ads, 
leaving  a  balance  of  $232,000  with  a  note  to  send  check' 
immediately,  and  then  the  word  Friday. 

Do  you  know  what  that  refers  to? 

A    I  think  I'm  writing  down  what  Mr.  Channell  was 
telling  me.   He  told  me  he  received  a  check  for  $272,000  from 
Mrs.  Newington, \40, 000  of  it  was  for  ads  for  the  campaign 
that  the  American  Conservative  Trust  was  sponsoring,  and  that 
they  were  sending  a  check  foirv232,000. 

Q    And  was  theY232,000  funds  that  were  to  be  trans- 
ferred to  the  account  from  which  disbursements  would  be  made 
at  the  direction  of  Colonel  North? 

A    It  was  funds  to  be  used  for  —  yes,  yes. 

Q  Now,  the  next  line  states  "Proof  of  battalion- 
Larry  McDonald  now  and  January  1  through  Rich  within  one 
week . " 

Do  you  know  what  that  refers  to? 

MR.  PRECUP:   There  are  three  lines,  Mr.  Fryman. 


543 


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iMiai  Nvomwa  co..  mc 

M7  C  ScR«.  N  E.  25 

Vuhoftoo.  DC.    20002 


Mimm 


537 


I'm  not  sure  that  each  —  you  can  check  with  the  witness 
whether  they're  related.   Nobody  said  they  are. 
BY  MR.  FRYMAM: 
Q    Fine.   I  mean  would  you  just  look  at  the  next  three 
lines,  Mr.  Miller,  and  tell  me  what  you  understand  they  refer 
to? 

A    Proof  of  battalion.   There  was  a  lot  of  talk  about 
the  Larry  McDonald  Brigade.   Adolf o  Calero  conunitted  to 
forming  orie.   And  Mr.  Channell  was  looking  for  proof  of  the 
battalion.   And  there  had  been  news  reports  about  it,  but  no 
hard  ^nspEk.  that  they  were  functioning. 

The  now  and  January  1,  I  don't  have  a  specific 
recollection.   Or  through  Rich  within  one  week,  I  don't  have 
a  specific  recollection  of  either. 

Q    Did  you  understand  the  $232,000  was  to  be  used  for 
any  particular  purpose? 

A    I  don't  specifically  remember. 
_  Q    What  are  the  notes  beneath  the  line  that  says 
through  Rich  within  one  week? 

A    The  rest  of  it  is  a  —  part  of  the  rest  of  this  is 
a  critique  by  Mr.  Channell  of  Colonel  North's  briefing. 

Q    And  would  you  just  read  your  notes  for  the  record? 
A    We  felt  it  was  too  long  and  not  current,  and  that 
it  needed  to  be  converted,  it  needed  to  lead  off  with  an 


explanation  about  the  southern  front  —  j  ;  j- 


m  iim 


rn 


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■■uiii  iwwxmtt  CO..  MC 

MTCSfim.  N.E.  25 

ViAmtnn.  DC.    2000] 


ISUSSKD 


538 


Q    Let  me  just  interrupt  you.    • 

When  you  say  it  needed  to  be  converted,  what  did 
you  mean  by  that? 

A    Converted  into  what  Mr.  Channel 1  thought  it  should 
be. 

Q    And  the  following  notes  are  a  description  of  what 
he  thought  should  be  in  the  briefing? 

A    Correct . 

Q    Would  you  just  continue  with  reading  or  your 
paraphrase  of  the  substance  of  the  notes  on  that  page? 

A    Southern  front  referred  to  the  recent  establishment 
of  the  southern  front.   The  parties  involved  was  an  update  on 
all  the  different  entities  who  had  joined  the  resistance.   He 
felt  when  he  said  no  little  girls,  there  were  too  many 
children,  and  what  was  needed  was  a  military  update,  and  that 
military  update  should  be  front  by  front,  including  discus- 
sions of  the  sub-bases,  plenty  of  visual  effects,  and  a  map 
showing  the  place  for  the  FDN^^  .  And  he  made  a  point  for  me 
to  say  to  Colonel  North  that  there  were  tigers  in  there  — 

Q    What  does  that  mean,  tigers  in  there? 

A    That  when  Colonel  North  briefed  his  contributors, 
that  these  people  were  tigers  and  that  they  much  preferred 
blood  and  guts,  forget  the  discussion  of  humanitarian 
assistance,  and  that  these  were  arch-fconservatives . 


He  us 


< 


Texans  look  at 


545 


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iiU£fi  MfMnmaa  co.,  mc. 
JO?  C  Sirect.  N  E  2  5 

WuhiDgioo.  D  C-    20002 


fH 


539 


Lyndon  as  an  example. 

Q    Who  was  Ross  Haley? 

A    He  was  a  Texan  that  wrote  "Texans  Look  at  Lyndon." 

Q    Was  ff^he   one  of  the  persons  who  attended  these 
briefings? 

A    Yes .   And  he  recounted  that  Bunker  Hunt  had  said  to 
him  that  he  didn't  trust  Adolfo  Calero,  and  that  what  he  was 
doing  was  coming  out  to  sniff  around  or  smell  around, 
whatever  that  meant. 

Q    And  does  that  mean  that  Mr.  Hunt  had  said  that  Mr. 
Calero  was  coming  up  to  smell  around? 

A  No,  no.  Mr.  Channell  was  saying  that  Bunker  Hunt 
said  he  did  not  trust  Adolfo  Calero,  and  that  he  was  coming 
up  to  Washington  to  smell  around. 

Q    He  being  Mr.  Hunt  was  coming  up  to  smell  around? 

A    Correct . 

The  rest  of  it  is  general  conversation  notes  of  Mr. 
Channell,  that  he  represented  17  millionaires,  and  that  he 
wanted  Mr.  McFarlane  for  a  drink  at  8  p.m. 

Q    When  you  say  he  represented  17  millionaires, 
there's  a  reference  to  August  pledges, 
what  does  that  refer  to? 

A    I  think  this  is  in  reference  to  one  of  the  July 
briefings.   And  Mr.  McFarlane,  he  wanted  Mr.  McFarlane  for  a 
drink,  and  that  he  hoped  that  I  would  convey  that  Mr. 

mm  fi^^'^-'m 


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mXIR  M90fVTM0  CO..  MC 
>07  C  Sutcc.  N  E.  25 


SSIflEO 


540 


McFarlane  had  some-  enemies  and  he  needed  to  make  some 
friends.   And  he  hoped  to  put  a  cap  on  Bert  Horowitzjro  anti- 
Bud  --  McFarlane  rather. 

Q    Who  is  Bert  Horowitz? 

A    He's  a  fund  raiser  who  was  supposed  —  well,  that 
Mr.  Channell  said  was  making  disparaging  remarks  about  Bud 
McFarlane. 

Q    If  you  would  turn  to  the  next  page,  which  appears 
to  have  your  Control  No.  4307,  is  that  in  your  handwriting? 

A    Yes. 

Q    Do  you  recall  making  those  notes? 

A    Yes. 

Q    What  were  the  circumstances  where  you  made  those 
notes  ? 

A 

Q 

A 

-  Q 
A 


It  was  a  phone  conversation  with  Bosco  Matamoros . 

And  do  you  recall  the  approximate  time? 

Mo. 

Nhat  does  the  first  item  in  those  notes  refer  to? 

That  they  had  captured  a  copy  of  a  Cuban  chemical 
warfare  manual,  them  being  FDN. 

Q    Do  you  know  why  he  was  reporting  this  to  you? 
A    He  often  reported  things  like  that  to  me  in  phone 
conversations . 

Q    What  does  the  second  item  refer  to? 

A    That  lUnd  JlellcQpters  were  operating  in  Nicaragua. 


547 


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507  C  Scren.  N  E.  25 

Wukmiron.  DC.    20002 
(2021  WA./^" 


illblA 


in 


541 


Q    What  does  the  third  item  refer  to?  . 
A    That  it  was  a  unit  of  Sandift^ta  trained  combatants 
who  were  killing  people  and  trying  to  draw  the  blame  to  the 
esistance  fighters. 

Q    Now,  the  third  item  has  the  words  weapons,  ammo, 
rifles,  boats. 

A    Boots .  ^  _. 

Q    Boots.   That  you  believe  refers  to  a  unit  of 
Sandinista  trained  combatants? 

A    I'm  sure  of  it.   The  M-16  machine  guns,  you'll 
remember  the  Newsweek  article,  the  combatants  in  the  Newsweek 
pictorial  of  the  execution,  supposed  execution  by  FDN 
sources,  were  carrying  M-16s.   And  they  had  fresh  boots,  and 
the  FDN  doesn't  carry  M-16s,  never  have,  never  will.   And 
that's  a  unit  of  Sandinista  soldiers  who  dress  up  as  contras 
and  go  out  and  kill  people. 

Q    What  does  the  last  item  refer  to.  No.  4? 
.  A    I  think  it's  just  a  repeat  of  No.  1.   It's  a 
captured  manual . 

Q    Are  pages  4244  through  4246  notes  by  you? 

A    Yes. 

Q    On  page  4245,  No.  2-A  reads  money  in  lake  -  make  AC 
understand. 

What  does  that  refer  to? 

A    I  don't  want  to  discuss  it  alone.   The  entire  next 


.  wa^ssifi 


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Wmkmfmn.  0  C    20002 


KlilSSiflES 


542 


three  items  eure  referenced  to  the  same  thing,  and  they're  all 
mental  notes  that  we  had  been  giving  an  awful  lot  of  money  to 
lake  resources,  and  Adolf o  Calero#  seemed  reluctant  to 
cooperate  with  our  effort,  and  was  inconsistent  to  us.  And  I 
was  trying  to  raise  it  to  Colonel  North  so  that  in  an  attempt 
to  make  Mr.  Calero  understand  that  we  were  the  people  giving 
the  money  to  lake  resources . 

Q         Are  these  notes  that  you  made  for  a  meeting  with 
Colonel  North? 

A    In  preparation  for  either  a  meeting  or  a  telephone 
conversation. 

Q    And  this  is  an  outline  of  points  you  were  to  raise 
with  him? 

A    That  I  wanted  to  raise  to  him,  yes.   But  I  don't 
see  any  slash  marks  or  hashes  so  I  don't  know  whether  or  not 
I  discussed  that  with  hln. 

Q    Do  you  recall  approximately  when  you  made  these 


notes? 
A 
Q 
A 

Q 


Sometime  in  October  I  guess,  September. 

October  of  — 

'85. 

On  page  4246,  No.  7-A  states,  "Bill  Casey  to  weigh 


in  after  a  reference  to  Bunker,  Garwood,  Harms  and  Sacher 
withRR."  Bi^»?^! 


What  does  that  refer  to? 


BgliSSifO 


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MT  C  Som.  N  L     2  5 
.  DC  MOO) 


Emwrn 


543 


A   -  Mr.  Channell  wanted  a  meeting  with  the  President  — 
for  those  four  people  together.   And  he  wanted  Bill  Casey  to 
weigh  in  and  Linda  Chavez  to  weigh  in. 

I  remember  I  did  that  in  one  of  my  notes,  it  meant 
that  it  was  something  that  I  dismissed  or  didn't  take  action 
on. 

Q    At  the  bottom  of  that  page,  there's  a  reference  to 
telephone  logs,  Prince  Abdulah  and  Caleedf 
.  what  does  that  refer  to? 

A    I  provided  Colonel  North  with  my  telephone  logs 
from  ai-Massoudi's  phone  calls  cepcftrfrAng  to-  bo  made  to 
members  of  a  Saudi  Royal  Family, 


^^^^^^^^^^  I  have  no  idea 
whether  they  did  it  or  not. 

Q    The  next  page,  4316,  does  that  page  contain  notes 
by  .you? 

A    Tes . 

Q    Would  you  explain  the  notes  at  the  top  portion  of 
the  page,  beginning  with  Barnes /Haailton? 

A    This  was  a  proposal  by  Congressman  Barnes  and 
Chairman  Hamilton  that  had  the  backing  of  Congressman  Fish 
and  Jones,  I  guess,  to  take  the  $14  million  that  the  President 
requested  and,  inAtead^  gJ-Yfi  S.5_sijli$n  to  the  International 


\f\  iMS 


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lauiii  MPOMTara  eo^  MC 
MT  C  Sunt.  N.E.  2  5 

VaihBfna.  DC.    VXXil 


544 


Red  Cross  ana.9  millioiv  to  the  Contradora  nations  and  nothing 
to  the  Jiesistance. 

Q    And  also  on  that  page  there's  the  word  "Ollie"  and 
four  items . 

Would  you  explain  what  those  items  refer  to? 

A    Those  were  things  I  wanted  to  talk  to  Colonel  North 
about.   Kurt  Windsor,  I  had  heard,  was  associated  with  the 
Crocker  family  fortune,  although  I  don't  know  how.   I  didn't 
understand  what  an  L-1  was,  and  I  thought  maybe  he  would  know. 

Q    Who  had  spoken  to  you  about  L-ls? 

A    al-Massoudi. 

I'm  not  sure,  but  I  think  Robelo's  name  was  Just  a 
reaction  to  President  Reagan's  compromise.  And  I  don't  even 
know  whether  the  nightline  thing  is  part  of  it  or  not. 

Q    On  page  4370,  are  they  your  notes? 

A    Yes. 

Q    WhM^d^  No.  9  refer  to? 

A    I  think  that  had  to  do  with  a  young  lady  that  was 
stranded  in  Managua,  NicuSftgua.   And  I  was  trying  to  enlist 
Colonel?' lhMeg^^§^BHB[i  getting  her  out  safely.   She  had  4jeen 
an  extensive  interview^p  with  Wesley  Smith,  and  the  Sandinista 
security  forces  had  been  around  to  visit  her  family  to  try 
and  locate  her  afterwards .  ^\^^i^%  ^'If^lVi'^W  ^^^   °"*' 
of  the  country  safely.       LlllLAd^iti  lU/ 

Q     Is  the  first  word  in  that  line  "paper"?  / 


551 


NS545 


MT  C  torn.  N.E. 
WntiiHiin.  DC 
(»»)  HI  Mil 


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Uh-huh. 

And  what  is  the  name  in  parentheses? 
iC 


refer  to? 


545 


Who  does 


I  thinJc  that's  my  —  the  reasons  it's  in  paren- 
theses  is  I  used  ^^^^meaning  the  CIA,  whoever  at  the  CIA 


Why  did  you  use  the  word 


was  the  CIA  agent 


would  handle  that. 

Q 

A    Because  I  knewl 
responsible  for  that  area. 

Q    I  don't  understand  how  the  reference  to  the  paper 
to  someone  at  the  CIA  by  Fawn  Hall  as  soon  as  possible 
relates  to  a  girl  in  Managua. 

A  Well,  there's  only  one  group  in  Managua  qualified 
to  help  get  somebody  out  «dio  the  American  Government  has  an 
interest  in,  and  that's  the  Central  Intelligence  Agency. 

Q    And  what  is  the  paper? 
.  A    It's  just  a  name,  address,  and  a  description  of  who 
the  girl  was. 

Q    And  approximately  when  was  this  note? 

A    I  don't  remember  specifically. 
(Pause) 

^^^^^^^^^was  associated 

■  r  N.  / '  s  J  »i  J  »•  J  '  !•  r  2  «  T% 
with  the  CIA? 

A 


Q    How  did  you  know  that 


ffiT 


'Ml 

I  had  heard  his  name  in  telephone  conversations. 


552 


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546 


Q  With  whom? 

A    I  shouldn't  say  telephone  conversations.   In 
conversations  with  Jonathan  Miller  predominantly. 

Q    And  Jonathan  Miller  had  identified  him  as  a  CIA 
employee? 

A    Correct . 

Q    Had  you  ever  met] 

A    Not  that  I'm  aware  of. 

Q   '  Mr.  Miller,  turning  to  the  page  with  your  Control 
No.  4611,  beginning  with  that  page,  there  are  a  series  of 
pages  with  your  consecutive  document  control  numbers  through 
your  Control  Ho.  4620. 

Would  you  look  at  those  pages? 

A    Yes. 

Q    Does  each  of  those  pages  contain  a  reference  to  a 
bank  account? 

A    Tes. 

Q    What  was  your  source  of  this  bank  account  informa- 
tion? 

A    Colonel  North  provided  these  to  me. 

Q    That's  with  respect  to  each  account  on  these  pages? 

A    Yes.   Except  for  your  second  one,  which  is  a 
recopying  of  the  first  by  me.   4612  was  a  recopying  of  4611 
done  by  me. 

Q    Let's  just  go  through  these. 


612  was  a  recopying  oi  to 

mmmts 


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I  mil  "M-UM, 


547 


A    I  have  to  amend  that.   I'm  sorry.   4614  also  was 
provided  to  me  by  Bosco  Matamoros  or  Alfonso  Cayallas.   I've 
forgotten  which  one. 

Q    Well,  let's  just  go  through  these  quickly  one  by 
one. 

Was  the  account  on  page  4611  provided  you  by 
Colonel  North? 

A    Yes,  and  so  was  that  piece  of  paper. 

Q    And  you  know  whose  handwriting  that  is? 

A     No. 

Q    But  the  piece  of  paper  was  given  to  you  by  Colonel 
North? 

A    Yes. 

Q    And  page  4612,  there's  a  copying  by  you  of  the 
information  on  page  4611? 

A    Correct . 

Q    What  was  the  source  of  the  information  on  page 
46413? 

A    That  was  given  to  m©  by  Colonel  North. 

Q    Was  it  given  to  you  in  form?   Was  there  a  typewrit- 
ten sheet  or  cards  which  is  reproduced  on  page  4613  given  to 

A     I  believe  so.   i^' i!  1  VsLii  ivl'^  J  3  %}r^%3 
Q    And  you  say  the  information  on  page  4614  was  given 
to  you  by  someone  other  than  Colonel  North? 


554 


MS548 

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14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

■ujii  mumfma  CO..  mc. 
W7  C  Sam.  N  E.  25 

Vaduifnio.  D  C.    20001 


<»»i 


548 


A    Yes.  - 

Q    And  that  again  was  whom? 

A    I  think  it  was  Bosco  Matamoros  or  Alfonso  Cayallas, 
but  I  think  it  was  Mr.  Matamoros. 

Q    And  he  gave  you  that  piece  of  paper? 
A    No.   He  gave  me  this  information  and  I  took  it  down 
as  he  read  it  to  me. 

Q    So  that ' s  your  handwriting? 
A    ■ Yes . 

Q    And  4615,  what  was  the  source  of  that  information? 
A    Colonel  North  gave  that  to  me  and  gave  me  the  piece 
of  paper  that  it  was  written  on. 
Q    And  4616' 

Colonel  North  dictated  that  information  to  me. 

Whose  handwriting  is  that? 

Mine. 

At  the  bottom  of  that  page,  there's  a  reference  to 
75. to  what  appears  to  be  N-e-i-l-l-e-s? 
A    Nellie. 

What  does  that  refer  to? 

Nellie  Livingston. 

And  is  th^t^^.directionto  you  from  Colonel  North? 

Yes. 

And  what  was  the  direction  for  you  to  give? 

To  send  $75,000  to  Nellie  Livingston's  organization. 


a  direction  to  you  frc 

llASSiFia 


555 


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22 

23 

24 
■um  iwyomwu  co..  mc 

M7CS<RC<.  NE.  25 

VaihjAftoa,  DC.    20003 


mmfE 


549 


Q    What  was  that  organization? 

Was  that  the  Institute  for  Terrorism  and  Subnational 
Conflict? 

A    Yes. 

Q    And  what  is  the  reference  under  that?   It  appears 
to  be  five  to  Father  something. 

A    Five  to  Father  LASSI.   That  was  to  Latin  American 
Strategic  Studies  Institute  run  by  Father  Tom  Dowling. 

Q   ,  And  what  is  the  note  after  that? 

A    I  don't  know. 

Q    Turning  tQ,.th«^iex^  pJM^  4617,  do  you  know  whose 
handwriting  appears  on  that  page?  a 

A    I  believe  that  is  Colonel  North's  handwriting. 

Yes. 

What  does  it  say  at  the  top? 

account. 
What  did  you  understand  this  account  to  be? 
It  was  ^^^^^^^M  an  account  associated  with 


Q    Turning  to  the  next  page,  4618,  do  you  know  where 
you  obtained  that  page? 

A    It  was  given  to  me  by  Colonel  North. 

Q    Whose  handwriting  is  on  that  page? 

A  Well,    I||l|ifiJ%thfp:fj,  jyf  j'Vi'^^Qij'  °i  people.       I    think 


iiMifiR^m 


556 


hwsSSO 


M7  C  StRn.  N  E 

.  DC.    2000] 


eassife 


550 


the  line  under  the  ID  number  is  somebody  I  don't  Jcnow,  u.  S. 
is  somebody  I  don't  know.   U.  S.  is  somebody  I  don't  know.  0. 
S.   is  somebody  I  don't  know.   But  the  telex  number  was  my 
assistant,  who  called  to  get  their  telex  number  so  that  I  had 
the  complete  transfer  information. 

Q    Is  this — 

A    His  handwriting  is  as  bad  as  mine,  so  it  is  easily 
identified. 

Q    .Is  this  one  piece  of  paper  that  was  given  to  you  — 

A    Yes. 

Q    — by  Colonel  North? 

A    Yes. 

Q    Directing  your  attention  to  page  4619,  from  where 
did  you  receive  that  note? 

A    That  is  a  hand%/ritten  note  on  one  of  my  note  cards 
by  Ad)lflfo  Calero. 

Q    That  is  Mr.  Calero 's  writing? 

A    Yea . 

Q    And  did  he  give  you,  give  that  note  to  you? 

A    Yes .   I  asked  him  to  write  down  'the  bank  number  and 
address,  and  he  did. 

Q    Turning  to  page  4620,  where  did  you  receive  that 
page  from? 

A    Colonel  North  gave  it  to  mg .._ii_wss  _a  jtjip  .of_ 
paper  that  that  information  was  on. 


ngt-i.t^ffs  _a  Jtrip  of  _ 


557 


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20 

21 

22 

23 

24 
■un  RCNirTMa  CO,  HC 

M7  C  Scnn.  N  I  25 

Wukntno.  DC.    20001 


h^iS 


l}J%3l 


551 


Q    Directing  your  attention,  Mr.  Miller,  to  the 
following  pages  with  your  control  numbers,  4623,  4624,  and 
4625,  4626  and  4627  and  4628,  are  those  pages  in  your 
handwriting? 

A    Yes. 

Q    Do  you  recall  when  you  made  these  notes? 

A    Sometime  in  1986. 

Q    What  was  the  purpose  of  making  these  notes? 

A    .1  was  trying  to  give  Colonel  North  a  more  accurate 
system  to  keep  track  of  the  money  that  was  in  the  accounts. 

Q    Were  these  notes,  were  the  notes  on  these  pages  all 
made  at  approximately  the  same  time? 

A    No,  one  of  them  is  a  more  comprehensive  document 
than  the  other,  and  superseded  the  other  documents. 

Q    Would  you  explain  what  you  are  referring  to? 

A    Yes,  4623  and  4624  ware  an  initial  attempt,  but  as 
expenditures  continued,  multiple  expenditures  continued,  for 
sone  of  the  accounts  that  Colonel  North  asked  me  to  send 
money  to,  I  tried  to  keep  a  running  total,  and  also  to 
reflect  the  commitments  that  he  told  me  he  had  made,  so  that 
his  commitments  didn't  get  out  in  front  of  his  available 
resources.  And  that  is  what  2645  and  2646  are.   4627  and 
4628  were  actually  the  crude  beginning  of  that  process, 
starting  with  the  $1,250,000  grant  from  NEPL. 

Q    So,  tM iffiy itflwfJlf ■  flgj-fli-Qrf  or  the  chronology  of 


ni^ram 


558 


hws552 

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8 

9 

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11 

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13 

14 

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16 

17 

18 

19 

20 

21 

22 

23 

24 
auiR  (apomura  co..  mc 

M)7CSutR.  NE.  25 

WuhmfTon.  0  C.     10O.> 


552 


these  documents,  the  first  effort  would  be  4627  and  4628? 

A    Correct. 

Q    The  next  draft  would  be  4623  and  26247 

A    Correct. 

Q    And  the  final  effort  reflected  in  these  pages  would 
be  4625  and  26? 

A    You  called  them  drafts,  I  wouldn't  say  that'  they 
were  efforts  to  keep  the  records  on  the  expenditures  made  by 
Colonel  Ntorth,  and  the  final  document,  462  5  and  4626, 
reflected  the  procedure  that  I  chose  to  keep  track  of  those 
commitments . 

Q    Did  you  keep  and  give  copies  of  any  of  these 
documents  to  Colonel  North? 

A    Yes,  in  fact,  I  think  he  received  copies  of  all 
six,  and  I  think  I  made  them  on  his  Xerox  machine. 

Q    Did  you  prepare  them  in  your  office? 

A    Yes. 

Q    And  you  took  them  to  his  office,  and  reviewed  them 
with  him? 

A    Yes. 

Q    And  left  copies  with  him? 

A    Yes. 

Q    On  three  different  occasions,  I  take  it? 

A    I  believe  that  is  correct. 

Q    Now — 


559 


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8 
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13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 

24 

uaxMD  mnmnta  co-  mc 
M7  C  Stun.  N  E.  2  5 

WwtaetuKt.  D  C.    2000] 


■mU 


553 


IV 


A    I  am  not  sure  whether  it  was  three  different 
occasions,  frankly.   But,  nonetheless,  he  received  copies  of 
this. 

Q    Let's  focus  on  the  last  draft,  which  you  have 
identified  as  Figures  4625  and  26.   On  the  first  line  there 
is  the  notation,  OB  Grant,  do  you  see  that? 

A    Yes. 

Q    What  does  that  refer  to? 

A    That's  my  shorthand,  I  use  doughboys  for  the  NEPL 
principles. 

Q    What  was  the  reason  for  using  that  phrase? 

A    Nothing  in  particular,  just  didn't  want  to  put 
their  names  down  on  a  piece  of  paper. 

Q    Did  you  discuss  with  Colonel  North  your  identifica- 
tion of  Mr.  Channell  and  Mr.  Conrad  as  doughboys? 

A    I  probably  used  it  in  his  presence,  I  don't  know 
that  I  discussed  it  with  him,  before  I  decided  to  start  using 
it._ 

Q    Do  you  know  if  you  informed  Colonel  North  as  to 
what  the  reference  to  DB  Grant  stood  for? 

A    Oh,  I  am  sure  I  did,  because  I  would  have  been 
discussing  this  with  him. 

Q    Now,  just  going  down  the  list  of  commitments,  there 
is  a  reference  to  Neal,  is  -that  iM^  Livingston^? 


Correct . 


INCUSSiFIED 


560 


hw8554 

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22 

23 

24 

wumwMKma  CO,  MC 

M7  C  Sens.  N.I.      2  5 

.  o.C.  snot 


554 


Q  And  ther«  is  a  reference  to  LAS,  what  does  that 
refer  to? 

A  That  is  LASSI,  Latin  American  Strategic  Studies 
Institute.  . 

Q    And  that  is  Father  Thomas  Dttlii(  ?  )'l7 

A 

A    Yes.   And  there  is  a  reference  to  SI^^l^,  what  does 

that  refer  to? 

0/ 
A    That's  Ad)(lfo  Calero's  Organization. 

Q   '  And  there  is  a  reference  ^C)^^^H  what  does  that 

refer  to? 

A    That  is . 

Q    Why  did  you  use  the  phrase,  ^^^1  to  refer  to 


^^^^^^^^^^^^^^^^^^^^^^^^^and 
memory  jog  for  maintenance  on  living,  special  benefit. 

Q    The  next  reference  is  WJ,  what  does  that  refer  to? 

A    Woodie  Jenkins. 

Q    And  is  Hr.  Jenkins'  organization  Friends  of  The 
Americas? 

A    That's  correct. 

Q 

A    Those  were  the  Latin  American  Congressmen  that  the 
Nicaraguan  Business  Council  brought  up. 

Q    The  next  reference  is  to  Clutch,  what  is  th*t? 
A    That's  Bosco  Matamoros, 


What  is  the  next  reference,  the  COTC? 


to  Clutch,  what  is  that?  , 


J  '.  'i  ^  i  ;■  'I  •  ' 


561 


vn  CSam.  NE. 
Vutunitoo.  0  C     U00> 
O02)  ni-au 


555 


Q    And  is  there  a  second  reference  to  Clutch,  with  a 
date  of  July  24? 

A    Yes. 

Q    Now,  under  that  there  is  a  reference  to  new 
commitments,  and  there  is  the  initials  EK,  what  is  that? 

A    That's  Dan  Kuykendall,  and  that  is  the  Gulf  and 
Caribbean  Foundation. 

Q    Do  you  know  the  reason  for  that  commitment? 

A    Yeah.   That  was  their  agreeing  to  pay  the  bills  for 
prosthesis  surgery  in  Miami,  and  that  was  the  reimbursement 
to  them  for  that. 

Q    And  what  is  the  reference  under  DK? 

A    UW. 

Q    And  what  is  that? 

A    That  is  Uno  Washington. 

Q    And  does  that  refer  to  the  Washington  office  of  the 
United  Nicaraguan  Opposition? 

A    Yes . 

Q    And  on  the  next  page  there  are  the  initials  TZ, 
what  does  that  refer  to? 

A    That  was  a  final  payment  to  Tony  Zumbado  for  some 
death  benefits  tiiafc  JukMaa  APi«f  |*tfPn^°  some  of  his  camera 

M&SSIFIED 

Q    Now,  also  on  that  page,  which  is  4  626,  toward  the 
bottom,  by  what  appears  to  be  October,  there  is  a  number  17 


562 


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23 

24 

H(U0l  WXIIIHIU  CO,  HC 
JOTCSciCTt.  NE.  25 

Vukioiraa.  DC.    :0002 


??^ 


556 


and  some  initials  that  appear  to  be -AGRO,  do  you  see  that? 

A    Yes,  that  is  the  October  17  transfer  to  AGRO. 

Q    What  is  that? 

A    That's  what  was  listed  in  the  AGRO  Bank  for  POLCA 
S.  A.,  in  the  previous  documents  that  you  asked  me  about. 

Q    What  did  you  understand  POLCA  S.  A.  was? 

A    I  have  no  idea.   I  still  don't  know. 

Q    Mr.  Miller,  turning  to  page  4924 — 

,MR.  PRECUP:   Mr.  Fryman,  excuse  me,  could  we  go  off 
the  record  a  moment? 

MR.  FRYMANt   Yes. 
(Discussion  off  the  record.) 
MR.  FRYMAN:   Back  on  the  record. 
BY  MR.  FRYMANt 

Q    Directing  your  attention  to  page  4924,  is  that  your 
handwriting? 

A    Yes. 

Q    Do  you  recall  making  those  notes? 

A    Barely. 

Q    Do  you  recall  the  circumstances  under  which  you 
made  those  notes? 

A  Yeah,  there  was  some  need  for,  I  think  this  is  the 
very  beginning  of  the  heavy  lifting  information  passed  me  by 
Colonel  North. 

Q    What  is  heavy  liftj 


•  i 


■■-  ONClASSinED 


563 


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2 

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17 

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19 

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22 

23 

24 

■uoi  MvonTMa  co .  —c 
)07  C  Stmt.  N  E  25 

Vuhiofua.  0  C     20002 


Oi^6LriOu 


557 


A   ■  Large  payloads  transported  by  air  bo  the  I^esistance 
/t'orces  inside  Nicaragua. 

Q    And  does  that  note  indicate  that  it  was ,  that 
$875,000  was  needed  for  that  purpose? 

A    For  800  hours  of  heavy  drops,  with  L-lOOs. 

Q    Turning  to  the  next  page,  4925,  is  that  your 
handwriting? 

A    Yes. 

Q    Do  you  recall  making  those  notes? 

A    Yes. 

Q    What  was  the  reason  you  made  those  notes? 

A    These  notes  were  given  to  me  by  Colonel  North,  as 


to  the  place  to  send  contributions 


A 


all  aircraft.   The 


top  half  is  the  account  data  for  the  bank  in  Geneva,  Switzer- 
landi^  and  the  bottom  half  is  a  general  description  of  the 


Yes, in  that  money  for  1^>  aircraft  was  to  be  sent 


aircraft  that  would  be  purchased  with  $60,000. 

Q    Hell,  are  the  two  halves  of  the  page  related?  The 
notes  on  the  two  halves  of  the  page. 

A 

to  Geneva,  Switzerland,  but  I  am  not  sure  whether  they  were 
both  written  at  the  same  time. 

Q    Was  that  the  first  time  Colonel  North  identified 
the  Lake  Resources  Account  in  Geneva,  Switzerland  to  you? 

A    I  don't  recall  whether  it  was  the  first  time  or 


W\  fi^^Jinrn 


564 


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22 

23 

24 
muMD  iwwmiia  eo..  mc 

M7CSlK«.  NE.  25 

Wukioiioa.  0  C.    20CCI 


*ussife 


558 


Q    If  you  would  turn  to  the  next  page,  which  is  page 
4926,  there  are  some  notes  on  that  page  which  appear  to  say 
Country  profile  on  Brunei  for  Dave  and  Martie.   Do  you  see 
those  notes? 

A    Yes. 

Q    Is  that  in  your  handwriting? 

A    Yes. 

Q    What  do  those  notes  refer  to? 

A   ' I  wanted  to  get  a  country  profile  on  Brunei  to  give 
to  Dave  Fischer  and  Martie  Artiano. 

Q    Why  was  that? 

A    Because  I  wanted  to  see  if  we  could  get  Brunei 
as  a  client. 

Q    What  was  the  reason  you  thought  of  Brunei  as  a 
possible  client? 

A    Because  they  would  be  a  great  client. 

Q    Anything  more  than  that? 

A    Nothing  more  than  that. 

Q    What  is  the  word  under  that,  on  the  next  line? 

A    Anthony. 

Q    Who  does  that  refer  to? 

A    Our  accountants . 

Q         And  under  that?  IIAIAI    M  f%^twawwm^ 

A  DK. 


ONCLASSIFIED' 


Does  that  refer  to  Mr.  Kuykendall? 


565 


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9 

10 

H 

12 

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17 

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22 

23 

24 

■un  mFtmt—a  eo..  mc 
MTCSotn.  NE.  25 

Vuhuina.  DC    20002 


KiMSim 


559 


Yes. 


Q    Do  you  know  why  there  is  notes  referring  to  your 
accountants  and  Mr.  Kuykendall,  at  that  spot? 

A    Probably  just  that  I  wanted  to  call  both  of  them. 

Q    Are  those  notes  related  to  the  note  with  respect  to 
a  country  profile  on  Brunei? 

A    No. 

Q    Mr.  Miller,  if  you  would  look  at  page  4927,  and 
also  page -4928,  are  those  notes  in  your  handwriting? 

A    Yes. 

Q    Do  you  recall  making  those  notes? 

A    Yes . 

Q    What  were  the  circumstances  when  you  made  those 
notes,  or  under  which  you  made  those  notes? 

A    They  were  a  telephone  conversation  with  Bosco 
Matamoros,  in  which  he  was  recounting  a  call  from  a — actually, 
I  thin^an  article  that  was  published,  or  about  to  be  pub- 
lished, I  think  in  the  Miami  Herald,  but  I  am  not  sure  if  I 
remember. 

Q    And  these  notes  relate  to  a  summary  of  the  allega- 
tions in  the  article? 

A    Yes.   It  is  so  exact  that  it  must  have  been  post- 
fact.   In  other  words,  it  must  have  been  already  printed,  and 
he  was  reading  it. 


Turning  to  page  4963,  are  those  notes  in  your 


566 


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21 

22 

23 

24 

WLLfM  NOOMTMa  CO..  MC 
507CSOCTI.  NE  25 

Wuhinfuxi.  DC.    20002 


CMssm 


560 


handwriting? 


A 
Q 
A 
Q 
A 
Q 
North? 
A 


Yes. 

Do  you  see  the  reference  $30, Ow  would  be  neat? 

Yes. 

What  does  that  refer  to? 

That's  what  Colonel  North  said. 

Are  these  notes  of  a  conversation  with  Colonel 


Yes, 


Q  Was  that  his  phrase,  $30,000  would  be  neat? 

A  Yes. 

Q  Do  you  recall  when  this  conversation  occurred? 

A  Sometime  in  1985. 

Q  Do  the  notes  above  that  refer  to  information  about 
a  specific  bank  account? 

A  Yes . 

Q  And  was  he  asking  you  to  raise  a  certain  amount  of 
money? 

A  I  don't  recall  whether  it  was  raise  it  or  transfer 
it. 

Q  What  does  $50,000  at  the  top  refer  to? 

A  I  think  he  was  looking  for  $50,000. 

Q  But  then  later,  he  said  $30,000  would  be  neat? 

Q  Yeah,  but  that  was  $30, 
Tool,  and  it  is  referenced  at  the 


-"imiFiED 


567 


hws561 


M7  C  SacR.  N.E 
ViAafna.  O.C 


1 

2 
3 
4 
5 
6 
7 
8 
9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

MC. 

25 


Mmm 


561 


Q    And  was  there  an  additional  $20,000  to  go  to  the 
Indians? 

A    I  see  the  note,  but  I  don't  recall  it.   Transfer 
$20,000  to  the  Indians. 

Q    What  is  the  number  at  the  bottom,  N0056838? 
A    I  don't  know. 

Q    Turning  to  the  next  page,  4970,  is  that  your 
handwriting? 
A    ■  No . 

Q    Do  you  know  the  source  of  this  information? 
A    Carlos  Ulvert  gave  this  to  me,  I  think. 
Q    Turning  to  the  next  page,  11002,  is  that  your 
handwriting? 

A    Yes . 

Q    What  do  those  notes  represent? 

A    That  was  an  initial  attempt  to  get  some  handle  on 
the  money  coming  in,  and  expenditures  by  me  for  Colonel 
North. 

Q    The  references  to  contributions,  and  a  particular 
date,  what  do  those  refer  to? 

A    NEPL  contributions.   I  would  like  to  point  out  that 
that  was  an  abortive  attempt;  it  is  not  very  complete. 

Q    That's  one  of  your  earliest  attempts? 

A  Yes.      It  may  well  have  been   just  an  attempt    from 

memory,    there  may  »yVf,l3ftV  #  A"tJ?gaUf  JJt  document,   with  an 


568 


hws562 


S.2 


«C. 

25 

V)7  C  Sum 

N.E. 

Taihiji|toa. 

DC 

20002 

owssm 


562 


earlier  date. 

Q    Turning  to  the  notes  which  are  on  page  19302,  is    | 
that  your  handwriting?  i 

A     No. 

Q    Do  you  know  who  gave  you  those  notes? 

A    Well,  wait  a  minute,  some  of  this  is  in  my  handwrit- 
ing, yes.   Yes,  this  is  my  handwriting. 

Q    Do  you  know  the  reason  that  you  made  those  notes? 

A   ' Yes . 

Q    What  was  the  reason? 

A    In  December  of  1985  there  was  a  lot  of  confusion 
about  the  ad  campaigns  that  Mr.  Channell  had  sponsored,  and  I 
wanted  to  create  a  time  line  that  showed  the  ad  campaigns, 
and  the  different  organizations  responsible  for  them,  to  make 
it  easier  for  members  of  the  media^  and  officials  to  under- 
stand who  was  doing  what,  at  what  time.  And  this  is  a  basic 
piece  of  paper,  that  was  my  instruction  to  one  of  my  employ- 
ees, as  to  how  to  go  about  doing  it. 

Is  the  name  on  that  page  Peter  blaji; ^t.^ ? 


Yes. 

Do  you  know  why  that  name  is  there? 

No. 

Turning  to  page  23345,  is  that  in  your  handwriting? 

Yes. 

What  do  those  notes  relate  to? 


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«us«o 


563 


A    I  think  this  was  the — it  is  two  different  things. 
The  first  is  a  Miami  International  Airport  Corporate  Air 
Center  and  ^ail  plumber,  and  that  was  when  we  flew  some  of  the 
Resistance  leaders  up  to  Washington  for  one  of  Mr.  Channell's 
events.   And  then  the  bottom  half  is  the  information  on  the 
backside  of  a  telephone,  for  the  phone  company  to  be  able  to 
turn  on  the  service. 

MR.  FRYMAN:   Off  the  record. 
• (Discussion  off  the  record.) 

MR.  FRYMAN:   Back  on  the  record. 

Mr.  Miller,  I  have  no  further  questions,  I  believe 
that  Mr.  Oliver  now  has  some  questions. 

EXAMINATION  BY  ASSOCIATE  STAFF  COUNSEL  OF  THE  HOUSE 

OF  REPRESENTATIVES 

BY  MR.  OLIVER: 
Q    Mr.  Miller,  earlier  in  this  deposition,  in  one  of 
the  previous  sessions,  you  indicated  that  you  had  worked  as 
oKief  of  News  and  Media  Relations  for  AID,  from  February  1981 
until  February  of  1982,  is  that  correct? 

A    I  think  my  actual  title,  from  the  very  beginning, 
was  the  Director  of — I  have  forgotten,  head  of  the  Media 
Relations  Division,  and  then  I  was  quickly  promoted  to  the 
Chief  of  n4ws  and  I^edia^i^lations . 

Q    And  |ll\t  service  at  AID  was  from  what  period  to 
what  period? 


rvice  at  AID  was  1 

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VukiOftDO.  0  C     20001 


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A    I  think  it  is  February  until  February. 

Q    Eighty-one  to  '83? 

A    The  total  AID  service  is  '81  to  '83,  that  is 
correct. 

Q    And  when  you  left  AID,  your  title  was  Director  of 
Bureau  of  Public  Affairs? 

A    It  was  not  a  Bureau,  it  was  an  office,  and  I  was 
the  Director  of  the  Office  of  Public  Affairs. 

Q         And  what  level  was  that  in? 

A    It  was  a  SES  political  appointment.  Level  3,  I 
think. 

Q    Was  it  at  the  Deputy  Assistant  Secretary  level? 

A    It  was  not  at  the  Deputy  Assistant  Secretary  level, 
there  was  an  effort  by  Mr.  MacPherson  to  put  it  back  to  the 
Deputy  Assistant  Secretary  level,  but  it  hadn't  come  to 
fruition  yet. 

Q    So  it  was  just  below  the  Assistant  Secretary  level? 

A    Again,  well,  first  of  all,  AID  doesn't  use  Assistant 
Secretary,  it  uses  Assistant  Administrators,  and  there  was  an 
Assistant  Administrator  for  External  Affairs,  but  as  you  are 
well  aware,  the  legislation  called  for  an  Office  of  Public 
Affairs/  and  an  Office  of  Legislative  Affairs,  botftyfiy 
Directors  who  were  n^t.  Presidential  appointees,  with^Senate 


confirmation.   So  we  were  Presidential  appointees,  without 
Senate  confirmation. 


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120])  M«-MM 


mmu) 


565 


Q    Who  was  your  boss? 

A    Peter  MacPherson. 

Q    You  reported  directly  in  the  chain  of  command? 

A    When  I  was  Director  of  Public  Affairs  I  reported 
directly  to  Peter  MacPherson,  and  Jay  Morris,  the  Deputy. 

Q    Did  you  meet  Frank  Gomez  during  that  period  of 
time? 

A    I  did. 

Q    And  what  was  his  position  at  that  time? 

A    When  I  first  met  Frank  he  was  Deputy  Assistant 
Secretary  of  State  for  Public  Affairs. 

Q    Did  you  participate  in  interagency  groups,  in  which 
Mr.  Gomez  participated? 

A    And  that  was  in  fact  the  occasion  of  our  first 
meeting,  he  and  I  together  called  an  interagency  meeting  on 
El  Salvador,  and  1  believe  in  February  of  1982,  and  I  sat  in 
on  interagency  meetings,  and  I  can't  recall  specifically  if 
Mr..  Gomez  was  there  or  not. 

Q    What  agencies  participated  in  those  meetings? 

A    There  were  a  couple  of  different  groups,  there  was 
the  Interagency  Steering  Committee,  and  I  can't,  off  the  top 
of  my  head,  remember  all  the  people,  there  had  to  be  10 
Federal  agencies  represented  there. 

And  then  there  was  a  Central  American  Policy 


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MufN  Nvonrno  co..  mc 

M7CS<Rn.Nt.  25 

a.  D.C    toon 


iihmm 


566 


represented . 

Q    Did  DOD  sit  on  both  of  those  interagency  committees? 

A    I  know  they  sat  on  the  Interagency  Committee,  I 
don't  recall  whether  they  sat  on  the  Policy  Committee. 

Q    Were  representatives  of  the  intelligence  community 
sitting  on  both  of  those  committees? 

A  I  was  never  introduced  to  anybody  as  a  member  of 
the  intelligence  community. 

Q    'CIA  was  not  represented  in  those  interagency  ' 
committees? 

A    Don't  ever  remember  seeing,  they  used  to  pass 
around  a  sheet,  and  I  don't  ever  remember  seeing  CIA  on  the 
sheet. 

Q    Why  did  you  decide  to  leave  AID? 

A    I  don't  like  working  for  the  Government  very  much. 

Q  Tou  have  been  working  for  the  Government  for  two 
and  a  half  years,  or  something  a  little  over  two  years,  at 
that  point? 

A    And  when  I  came  to  Washington  I  started  as  a 
Federal  employee,  when  I  graduated  from  college,  and  then 
left  the  Government  in  1976,  I  already  had  tiig=«Kr  a  hal'f 
years  of  Federal  Service,  so  I  am  quite  familiar  with  serving 
at  the  bottom  and  the  top  of  the  Federal 
didn't  like  either  one  of  them,  so  I 

Q    What  did  you  do  immediately  upon  your  resigning 


iral  Ga\^rnment,    and   I 


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aujn  MPORTMa  CO.  nc 

>07CSin«.  NE.  25 

Wadimina.  DC.    20002 


SMflEO 


567 


from  AID? 

A  I  started  International  Business  Conununications , 
and  began  work  on  developing  clients.  I  had  a  consultant's 
contract  with  AID  for  some  media  roundtable  work,  and  there 
was  one  other  thing  in  the  contract,  which  I  can't  remember 
off  the  top  of  my  head,  but  it  was  a  consultant's  contract, 
and  it  required  me  to  provide  some  services  to  the  Ad- 
ministrator of  the  agency. 

Q    How  long  did  that  contract  run? 
A    Well,  it  was  for  a  year,  but  as  I  recall,  it  did 
not  run  its  full  term,  it  ran,  I  want  to  say  six  months,  but 
at  this  stage  I  can't  remember,  but  we  both,  Peter  MacPherson 
and  myself,  agreed  that  it  was  just,  neither  one  of  us  wanted 
it  to  continue,  and  so  we  stopped  it. 

Q    What  was  the  amount  of  the  compensation  for  that 
contract? 

A    I  believe  it  was  whatever  the  top  consultant's  rate 
is,.  «^ich  is  usually  consistent  with  whatever  the  SES  rate 
is,  so  they  are  usually  pretty  much  the  same  thing. 

Q    Did  you  have  any  other  Government  contracts  during 
that  period  of  time,  the  first  year,  after  you  left  AID? 

A    No. 

Q         ".^f"^"  ^*!^  Ji??™^»-S*.^***^  y°"  *****  *  Government 
contract? 


USSIFIED 


Well,  Frank  Gomez  started,  excuse  me,  the  initial 


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mxMn  nrOKTMO  co.,  mc. 
507  C  iam.  N  E  2  5 

WuhuiinMi.  DC.     2000? 


m 


lED 


568 


lASSIFIED 


contract  in  February,  in  fact  I  think  the  contract  was  signecj  ' 
February  22nd,  with  the  State  Department,  in  1984.   And  I 
don't  think  it  was  until  1985  that  they  were  IBC  contracts, 
they  originated  as  Francis  D.  Gomez,  and  then  became  Francis 
D.  Gomez  International  Business  Communications,  after  we 
began  to  form  the  partnership,  and  eventually  became  Inter- 
national Business  Communications,  as  Frank  was  a  partner  in 
International  Business  Communications. 

Q    When  Frank  Gomez  received  the  first  contract,  in 
February  of  1984,  what  was  his  relationship  to  you,  at  that 
point? 

A    He  was  planning  to  come  on  board  as  a — attempting 
to  come  on  board  as  a  partner,  but  his  responsibilities  at 
that  time  were,  in  accounting  terms,  as  a  subcontractor. 

Q    A  subcontractor? 

A    To  IBC. 

Q    To  IBC.   But  did  the  initial  contract  with  the 
Sta-te  Department  have  your  involvement,  in  any  way? 

A    The  initial  contracts  with  the  State  Department, 
our  only  involvement  was  in  providing  staff  services  and 

administration,  for  Mr.  Gomez.   That  would  have  been  our 

I 
involvement. 

Q    But  it  was  his  contrpct?. 

A    That's  correct. 

Q    And  were  you  sharing  offices  at  that  time? 


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IML10  nVOIfTVMCOM  MC- 
M7  C  ScRtt.  N  E  2  5 

VaAagna.  D  C.    3000] 
11021 14<  MM 


'li 


LASSIFIED 


569 


A  Yes.      At  what   time? 

Q    At  the  time  that  he  got  the  first  State  Department 
contract,  in  February  of  1984. 

A    Yes. 

Q    But  you  didn't  have  a  business  relationship,  other 
than  arms-length  subcontract'^contractor  arrangement? 

A    No.   I  think  you  improperly  injected  the  word 
" arms- length. "   Subcontractor  doesn't  mean  that  you  are  at 
arms-length.   It  is  an  accounting  principle.   Frank  Gomez  was 
a  subcontractor  to  IBC,  in  terms  of  accounting.   Both  he  and 
I  were  working  towards  a  full  partnership,  and  he  did 
maintain  some  other  work  which  he  did  not  bring  into  IBC. 
That  is  a  general  description  of  his  business  relationship  to 
me. 

Q    Where  did  you  derive  your  income  from  in  1984? 

A    From  clients. 

Q    Any  of  those  clients  related  to  Central  America? 
.  A    Tea . 

Q    Which  ones? 

A    The  Gulf  and  Caribbean  Foundation,  predominantly 
the  Gulf  and  Caribbean  Foundation,  in  1984.  Well,  the  Gulf 
and  Caribbean  Foundation. 

Q    When  did  that  relationship  begin? 

A    I  think  it  was  in  December  of  1984,  maybe  November. 

Q    Between  January  of  1984  and  December  of  1984  did 


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IttJjat  MMRTMO  CO..  MC 
507  C  Sam.  N  E  25 

Vuhufion.  D  C.    20001 
(202)  M6-MM 


p^^fi 


mmim 


570 


any  of  your  work  relate  to  Central  America? 

A    Yes,  the  Gulf  and  Caribbean  Foundation. 

Q    I  meant  prior  to,  you  said  December  of  1984,  was 
when  you  thought  that  Gulf  and  Caribbean  began,  and  I  was 
asking  from  January  of  1984  to  December  of  '84,  which  is 
almost  a  year. 

A    Well,  I  said  that  I  believe  we  started  working  for 
the  Gulf  and  Caribbean  Foundation  in  December  or  November,  so 
prior  to  gur  work  for  the  Gulf  and  Caribbean  Foundation. our 
contact  with  Central  America  would  have  been,  in  general 
terms,  we  represented  a  UH  agency  that  was  involved  in 
funding  the  Third  World  development  projects,  some  of  which 
were  in  Central  America. 

We  represented,  of  course,  I  had  the  consulting 
contract  with  AID,  and  AID  is  deeply  involved  in  Central 
America,  and  the  media  roundtables  would  have  incorporated, 
as  it  was  a  hot  subject  at  the  time,  Central  America. 
_  Q    I  thought  that  you  said  that  the  consulting 
contract  ran  from  February  of  '83,  when  you  left  AID,  for 
about  a  year,  and  then  you  didn't- 

A    Correct. 

Q    — do  the  whole  time.   So  what  I  am  trying  to  do  is 
to  fill  the  gap  in  between  that  contract  and  the  Gulf  and 
Caribbean  relationship,  which  I  assume  would  be  late  in  1983 
until  late  1984,  so  my  question  is,  during  that  period  of 


n't--  _^, 

ICUSSIFItO 


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HUIN  mromma  co..  mc 

)07  C  Scrm.  N  E  25 

Wuluiifnxi.  0  C      20002 


ONCUSSIflEfl 


571 


time,  after  the  consulting  contract  with  AID,  prior  to  the 
Gulf  and  Caribbean  relationship,  did  any  of  your  clients 
relate  to  Central  America? 

A    Again,  the  HH  agency  that  I  just  described  to  you, 
and  the  others,  but  only  in  general  terms.   We  worked  with 
20th  Century  Fox,  who  was  doing  an  Olympics  project,  I  guess 
you  could  say  that  related  to  Central  America,  but  only  in 
general  terms. 

Q    How  big  a  staff  did  you  have  during  that  period  of 
time? 

A    Two  people. 

Q    You  and  one  other,  or  you — 
A    Myself  and  two  others. 
Q    Two  others . 
A    Yes . 

Q    When  did  you  begin  to  participate  in  the  State 
Department  contracts,  as  a  consultant,  or  when  did  you  begin 
to  J)e  compensated  for  work  that  yoa  did  in  relation  to  the 
State  Department  contracts. 

A    You  asked  two  questions .   We  were  trying  to  form  a 
partnership,  and  Mr.  Gomez  put  his  proceeds  from  his  profes- 
sional efforts  into  the  general  coffers  of  International 
Business  Communications,  in  an  effort  to  develop  enough 
business  to  sustain  atpartn$rstw-B«^  ^T^^  is  the  answer  to 
your  second  question. 


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572 


-  The  first  question  was  that  initially  my  respon- 
sibility was  to  provide  administrative  and  professional 
backup  to  Mr.  Gomez,  and  that  incorporated  everything  from, 
you  know,  developing  media  lists  for  his  work,  providing 
files  for  development  of  articles. 

So  really,  from  the  start,  we  were  involved,  all 
the  people  were  involved  in  Mr.  Gomez's  contract. 

Q    When  did  you  first  meet  Otto  Reich? 

A    I  can't  tell  you  exactly  when,  but  it  was  sometime 
in  1981. 

Q    While  you  were  at  AID? 

A    That's  right.  Otto  was  the  Assistant  Administrator 
for  Latin  America. 

Q    Was  Mr.  Gomez's  first  contract  with  the  State 
Department  under  the  office  that  Otto  Reich  headed  at  that 
time? 

A    Yes. 
.  Q    Did  you  have  any  participation  or  involvement  at 
all  in  securing  that  contract? 

A    I  don't  recall  having  any,  no. 

Q    Do  you  know  Halt  Raymond? 

A    I  have  met  Walt  Raymond,  yes. 

Q    When  did  you  first  meet  Walt  Raymond? 

A    I  think  Raymond  came  to  some  of  the  interagency 
group  meetings.   I  don't  recall  specifically  which  ones,  but 


ONCLASSIFIED 


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Vuhinfion.  D  C      20001 


»\'iJ 


U\J 


573 


I  think  he  was  present  at  some  of  them.   And  Prank  set  up  a 
lunch  one  time,  I  think,  and  maybe  it  was  a  breakfast,  and  I 
met  Raymond  one  time. 

Q    When  was  that? 

A    Sometime  in  1984,  I  think. 

Q    What  was  the  purpose  of  the  breakfast? 

A    Just  a  get^acquainted  session. 

Q    Do  you  remember  what  was  discussed  there? 

A    No . 

Q    Did  you  have  any  dealings  with  Walt  Raymond,  after 
that? 

A    Occasionally,  because  in  19884  he  had  some  involve- 
ment in  the  information  development  on  the  Reagan  Administra- 
tion policy  in  Central  America,  and  I  am  sure  I  have  had 
telephone  conversations  with  him,  or  been  to  meetings  at 
which  he  was  present. 

Q    Since  that  breakfast,  and  since  you  left  the 
Government? 

A    That's  correct. 

Q  Do  you  remember  what  the  substance  of  those 
conversations  with  Walt  Raymond  was  about,  if  you  can 
remember? 

A    I  can't  remember  the  substance,  they  would  have 
been  generally  about  Central  America,  Reagan  Administration 
Central  American  policy,  but  specif icallv.  I  can't  remember 


n  policy,  but  specifically,  I  can't 


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mtxm  iMWiHiwu  CO..  mc 
MT  C  Sum.  N.E.  2  5 

Wak^m.  DC.    lotel 


y^CUSoifiEB 


574 


any  of  the  details. 

Q    Old  he  ever  discuss  fiS>h  your  work  for  Spitz? 

A    Mo,  not  that  I  can  recall. 

Q    When  did  you — I  am  sorry,  you  said  earlier  that  you 
met  Jonathan  Miller  in  the  1980  campaign,  is  that  correct? 

A    That's  correct. 

Q    And  that  you  became  good  friends? 

A    No. 

Q   '  Over  a  period  of  time? 

A    I  didn't  really  get  to  know  Jonathan  until  our  work 
together  at  AID. 

Q    And  what  was  his  job  at  AID? 

A    He  was  in  the  Legislative  Affairs  area  for  a  while, 
and  then  went  to  become  a  country  Director,  somewhere,  I 
forgot  where.  Assistant  Country  Director,  I  have  forgotten 
what  position  it  was,  but  he  trent  off  to  Africa,  I  think.   I 
cail'i  remember  specifically. 

_  Q    Was  that  for  AID,  or  for  the  Peace  Corps? 

A    Could  have  been  for  the  Peace  Corps . 

Q    And  then  when  did  you  renew  your  acquaintanceship? 

A    when  he  popped  up  again  at  the  State  Department,  in 
Otto  Reich's  office. 

Q    And  during  the  time  that  Frank  Gomez  had  contracts 
with  LPD,  was  Jonathan  Miller  the  official  technical  represen- 
tative for  the _5J;p J^ Qeoartment ,  on  those  contracts,  the 


>  _State  Department ,  on  th< 


581 


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person  responsible  for  the  oversight? 

A    I  don't  remember  who  was  responsible  in  the  first 
contract,  and  that  is  probably  because  I  wasn't  involved  in 
the  direct  negotiations  on  it.    But  the  people  whom  I  recall 
us  reporting  to  would  have  been  Otto  Reich,  Jonathan  Miller, 
John  Blacken  and  John  Scath. 

Q    You  reported  to  all  four  of  them? 

A    At  different  times,  yes.   And  some  of  them  simul- 
taneously. For  instance,  John  Blacken  and  Jonathan  Miller 
were  Deputies,  there  were  two  Deputies  under  Otto  Reich,  and 
then  when  Jonathan  Miller  moved,  John  Blacken  moved  up  to 
that  Deputy  slot,  and  I  think  John  Scath  moved  into  the  other 
one. 

Q    You  started  to  report  to  them  after  IBC  got  its 
first  contract  from  the  State  Department? 

A    That's  correct. 

Q    When  was  the  first  IBC  contract? 
.A    It  was  signed  on  Febmiary,  I  believe  the  date  is 
correct,  it  was  signed  on  February  22nd  of  1984. 

Q    That  was  the  Gomez  contract? 

A    That's  correct. 

Q    The  first  three  contracts  were  in  Mr.  Gomez's  name, 
but  they  were  with  him,  not  with  IBC.   My  question  was  when 
did  IBC  get  its  first  contract  with  the  State  Department? 

A    I  am  not_sur9  I  'SffT  M'Saafc  y"""  characterization,  I 


tiMrR^^i^fti 


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hws576 

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Vuhaitoa.  DC    10001 


yNCUSSlflED 


576 


don't  have  a  copy  of  the  contracts  in  front  of  me.   But  I 
believe  that  one  or  two  of  them  said  Francis  D.  Gomez 
International  Business  Communications. 

Q    So  you  started  to  meet  with  these  people  from  the 
time  that  Frank  Gomez  had  this  contract,  had  his  first 
contract? 

A    I  can't  be  that  specific.   I  can't  tell  you  whether 
in  the  first  three  months  of  Frank's  being  at  IBC  whether  I 
met  with  ?ny  of  these  people  or  not. 

Q    From  October  1st  of  1985  to  September  30th,  1986, 
IBC  had  a  contract  with  the  State  Department  that  was 
classified  as  secret,  which  was  substantially  more  than 
previous  contracts  that  IBC  and  Frank  Gomez  had  with  the 
State  Department. 

Could  you  tell  me  when  you  began  to  negotiate  that 
increased  level  of  contract  with  the  State  Department? 

A    During  the  completion  of  the  previous  contract, 
which  was  for  90^some  thousand  dollars.   We  were  asked  by 
John  Blacken  to  review  the  publication  distribution  system, 
and  we  had  given  an  assessment  of  its  effectiveness.   It  was 
a  short  process,  and  the  results  of  our  exploration  were 
startling  to  us,  disheartening  to  us,  because  we  had  put  a 
lot  of  work  into  developing  materials  to  be  disseminated  to 
the  public,  only  to  find  out  that  they  were  not  getting 


disseminated 


(lfrif/t^i?r?iftf 


istribution  mechanism. 


583 


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■uomvomMa  eo„  MC 

m;  C  Jmn.  N  E.  2  5 

WariMVMi.  n.C     U002 


yriussiFiEo 


577 


They  were  very  distressing  to  Otto  Reich  and  John 
Blacken,  because  that  was  one  of  their  charges.  And  the 
subsequent  contract  negotiations  started  almost  immediately, 
with  them  asking  for  a  recommendation  to  have  us  add  the 
distribution  process  to  our  responsibilities  of  media 
relations,  escort  services  and  political  counseling. 

So  we  made  a  proposal  for  Ms  increased  contract, 
with  a  separate  section  for  the  distribution,  and  that  seemed 
to  move  quickly,  until  it  got  to  the  Contracts  Office,  who 
then  informed  us  that  this  was  an  entirely  different  form  of 
contract,  that  it  would  have  to  be  redone,  as  a  cost-plu^ 
fixed>fee  contract.   By  this  time  we  were  already  beginning 
to  perform  the  same  services  that  we  had  provided  in  fiscal 
1985,  in  fiscal  1986, land  we  were  assured  by  the  Contract 
Office  that  they  would  produce  a  ratification  letter,  so  that 
we  would  not  be  performing  these  services  without  compensa- 
tion.  And  %««  then  irant  through  the  process  of  negotiating  a 
coat-plus  fixed^ fee  contract,  something  that  I  would  not  wish 
on  anybody,  it  is  a  pretty  deliberative  process,  including 
having  OCAA  auditors  in  your  offices,  and  full  exploration  of 
your  books,  and  demands  for  accounting  practices,  and  so 
forth. 

And  that  all  took  a  long  period  of  time.   In  fact, 
%re  didn't  even  finish  up  until  we  were  through  a  great 


preponderance  o 


sioned  under  the 


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contract. 

Q    So  the  new  component,  the  way  in  which  this 
contract  differed  from  the  previous  $90,000  contract,  was  the 
distribution  system? 

A    That's  correct. 

Q    So  why  was  it  classified  secret? 

A    Well,  I  can  tell  you  why  I  thought  it  was  classified 
secret,  and  recount  a  conversation  with  Jonathan  Miller  to 
that  effect.   We  had  drawn  the  interest  of — we  are  right  up 
against  the  other  barrier  we  were  up  against  before — we 
discussed  this  in  a  previous  deposition. 

I  don't  know,  do  you  want  to  go  off  the  record? 
MR.  OLIVER:   Yes,  let's  go  off  the  record. 
(Discussion  off  the  record.) 

MR.  OLIVER:   Before  we  go  any  further,  Mr.  Miller, 
do  you  have  a  security  clearance  from  the  U.  S.  Government  at 
this  point? 

THE  WITNESS:   I  am  not  sure  of  that.   We  had  one, 
and  we  were  notified  by  the  Office  of  State  Security,  State 
Department  Security  Office,  that  they  were  going  to  lift  it, 
so  I  can't  tell  you  whether  it  is  in  force  right  now  or  not. 
BY  MR.  OLIVER: 
Q    When  was  tt^^  la^,jtifie^^^^9^^d  a  personal 
securi 

A    Up  until  a  matter  of  three  or  four  iraeks  ago. 


:..:r:;MKM! 


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Q    You  testified  earlier  that  you  had  worked  at,  I 
believe,  the  General  Services  Administration,  and  then  the 
Department  of  Transportation,  and  then  AID. 
A    Yes. 

Q    During  those  periods  of  time  you  had  Government- 
authorized  security  clearance,  isn't  that  correct? 
A    That's  correct. 

Q    Is  it  your  understanding  that  when  you  terminate 
the  employment  for  which  the  security  clearances  are  neces- 
sary, that  the  security  clearance  is  also  terminated? 

A     It  is  my  understanding  that  the  security  clearance 
is  predicated  on  employment,  so  that  a  security  clearance  is 
undertaken  when  you  are  employed,  and  you  maintain  your 
clearance  as  long  as  you  are  employed,  with  the  caveat  that  if 
you  have  longer  than  a  three^month  break  between  employment, 
then  you  have  to  go  through  the  security  clearance  process 
all  over  again. 

-  Q    Well,  between  February  of  1983,  when  you  left  AID, 
and  became  a  private  citizen,  and  October  1st  of  1985,  what 
would  have  been  the  reason  for  you  to  have  a  security 
clearance? 

A    I  didn't  have  a 
Q    When  did  you- 

A    Although  I  am  3ur«  the  Agency  for  International 
Development  considered  my  clearance  active  while  I  was  a 


KCTED 


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Vutuattos.  D  C      10002 


UNCLASSIFIED 


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consultant  to  Mr.  MacPherson,  but  he  would  have  to  answer 
that  one. 

Q    Were  you  ever  notified  that  you  had  a  security 
clearance,  while  you  were  a  consultant? 

A    It  isn't  vacated  if  you  have  no  break  of  employment, 
is  what  I  am  trying  to  tell  you. 

Q    Well,  my  understanding  of  security  clearance  is 
considerably  different.   My  understanding  is  that  you  have  a 
security  Clearance,  on  a  need^tc^know  basis,  for  work  that 
you  are  performing  for  the  Government,  and  once  you  stop 
performing  that  work,  you  no  longer  have  a  security  clearance, 
and  I  think,  all  the  clearances  that  I  have  had,  you  had  to 
sign  papers  to  that  effect.   And  I  know  if  I  leave  my 
employment  my  security  clearance  is  no  longer  in  effect. 

And  that  is  why  I  am  asking  you  whether  any  steps 
were  taken  to  maintain  your  security  clearance,  after  you  left 
the  Government. 
_  A    No, 

MR.  PRECUP!   By  you? 

THE  WITNESS:   By  me,  none  were  taken  by  me. 

BY  MR.  OLIVER: 

Q    Do  you  know  of  any  steps  that  were  taken  to 
maintain  your  security  clearance,  while  you  were  a  consultant 
to  AID? 

A    Not  that  I  am  aware  of. 


UNClWF^nrq 


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Q  The  contract  which  you  were  performing  in  the 
amount  of  $90,000,  which  preceded  the,  I  believe  it  ran 
through  September  30th,  1985? 

A    Correct. 

Q    Did  that  contract  require  a  security  clearance? 

A    No. 

Q    But  the  contract  that  began  on  October  1st,  1985 
required  a  security  clearance,  is  that  correct? 

A    That  is  correct. 

Q    And  it  required  a  security  clearance  for  how  many 
of  your  employees? 

A    Well,  ultimately  it  was  decided  that  there  were 
only  two  employees  to  be  cleared,  and  that  was  Mr.  Gomez  and 
myself,  and  that  was  decided  finally  by  the  Defense  Investiga- 
tive Agency. 

Q    And  did  they  notify  you  that  you  had  received 
security  clearances? 


i^y 


-u 


.  A    They  notified  us  that/both  an  interim  security 
clearance  and  the  final  security  clearance. 

Q    Were  those  security  clearances  for  you  and  Mr. 
Gomez,  or  were  those  facility  security  clearance  for  your 
office? 

A    They  were,  under  the  circumstances,  actually  one 
and  the  same  thing,  because  we  were  not  cleared  to  have 
classified  materials,  custodial  responsibility  for  classified 

HMO!  ?'»«'"rn 


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IMXn  WPOKIWO  CO.,  MC 
MTCSori.  NE  25 

.  DC.    20001 


UNCLASSIFIED 


582 


materials,  and  we  are  the  facility,  since  it  was  a  partner- 
ship, so  they  decided  finally  it  was  only  necessary  for  them 
to  clear  the  two  of  principal  partners,  which  they  did. 
Q    When  did  they  give  you  an  interim  clearance? 
A    I  don't  remember  specifically,  sometime  in  about  the 
middle  of  the  year. 

MR.  OLIVER:   If  I  may,  I  would  like  to  ask  the 
reporter  to  mark  this  as  Miller  Exhibit  31,  and  indicate  that 
this  is  a  'compilation  of  documents  that  are  related  to  the 
IBC-State  Department  contracts. 

MR.  BUCK:   I  was  just  going  to  suggest  that  the 
witness  look  at  the  exhibit. 

MR.  PRECUP:   Now,  Mr.  Oliver,  this  is  a  thick 
document,  so  rather  than  having  the  witness  go  through  it, 
would  you  invite  his  attention  to  the  specific  areas. 

MR.  OLIVER:   I  will  invite  his  attention  to  various 
pages  as  vb   go  through,  rather  than  ask  these  questions,  I 
will  try  to  have  him  look  at  these  documents,  so  he  can 
refresh  his  memory  from  them  as  we  discuss  them. 

(The  document  referred  to  was 
marked  for  identification  as 
Miller  Deposition  Exhibit  No. 
31 


BY  MR.  OLIVER:     11^ 
Q    If  you  would  look  at  the  second  page  of  that 


IHED 


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VMtuifisa.  DC.    2000] 
(Ml)  Mt-44M 


^^1 


LASSIFIEO 


583 


compilation  o£  documents,  January  11th,  1985,  which  is  a 
memorandum  to  International  Business  Communications,  and  ask 
you  to  identify  it? 

MR.  PRECUP:   I  am  not  finding  this. 
MR.  OLIVER:   Page  two,  the  next  one,  the  very  next 
page. 

MR.  BUCK:   It  is  just  a  three  page  document. 
MR.  PRECUP:   To  whom? 

,MR.  OLIVER:   It  is  a  January  11,  1985  memorandum/ 
MR.  PRECUP:   We  found  it. 
BY  MR.  OLIVER: 
Q    I  would  like  to  ask  you  to  examine  that  document, 
and  tell  me  whether  or  not  you  have  ever  seen  it  before. 
A    Yes. 

Q    Is  this  document  an  accurate  reflection  of  the 
services  that  Frank  Gomez  and  IBC  performed  for  the  State 
Department  on  the  $90,000  contract  that  ran  from,  I  believe 
it  ran  fiscal  1985? 

A    No,  actually  I  think  this  is  fiscal,  no,  you  are 
right,  it  is  the  first  quarter  of  fiscal  year  1985. 

Q  Actually,  it  looks  like  the  last  quarter  of  fiscal 
1984  and  the  first  three  months  of  1965,  but  let  me  rephrase 
the  question. 

Is  this  an  accurate  reflection  of  the  work  that  IBC 
was  doing  for  the  State  Department  in  January  of  1985,  had 


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)07  C  Sllftl.  N  E  2  5 

Vaihuipon.  D  C      20002 

12021  VM.WJ66 


(ib 


LASSIFIED 


584 


been  performing,  for  the  State  Department?     .-..  .......  . 

A    Yes. 

Q    Were  you  involved  in  any  or  all  of  these  10  items? 

A    Many  of  these  10  items. 

Q    Was  anyone  else,  besides  you  and  Mr.  Gomez, 
involved  in  work  for  IBC,  involved  in  these  activities? 

A    Sure. 

Q    Who  were  the  others  who  had  responsibilities  for 
any  of  th^se  specific  items? 

A    Jeff  Keffer,  Jacqueline  Clemonds,  Mona  St.  Leger,  I 
am  going  to  embarrass  my  employees  when  I  don't  remember  all 
their  names,  Anna  Chrysler,  and  some  subcontractors,  as  well. 

Q    Number  2  on  that  list,  says  Creation  and  Implementa- 
tion of  Immediate  Plans  for  S/LPD-directed  newsmakers,  what 
does  that  mean? 

A    There  were  people  who  S/LPD  brought  up  to  Washing- 
ton, to  have  them  address  the  media  on  Central  American 
issues.   People  like  defectors,  atrocity  victims,  refugees. 

Q    When  you  say  LPD  brought  them  up,  what  do  you  mean, 
do  you  mean  they  paid  for  them? 

A    I  can't  tell  you  who  paid  to  get  them  here,  but 
once  they  got  here  they  were  S/LPD' s  responsibility. 

Q    Do  you  know  who  paid  their  expenses? 

A    Not  specifically,,  no.   We  would  sometimes  get 
organizations  to  sponsor  them^ and  have  those  organizations 


591 


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CO..  MC   ' 

25  1 


UNCLASSIFIED 


58S 


pick  up  thalr  expenses .   But  that  was  Washington  expenses ,  or 
U.  S.  expenses.   But  how  they  got  to  the  United  States^se 
"nisr,  I  can't  tell  you  who  paid  for  it. 

Q    What  made  you  think  that  S/LPD  brought  them  up? 

A    Well,  I  will  use  a  different  phrase.  I  was  aware 
that  when  they  got  here  they  were  S/LPD' s  responsibility. 
Obviously  S/LPD  would  have  had  some  coordination  in  getting 
them  here,  or  they  wouldn't  have  been  able  to  notify  us  that 
they  were  coming. 

Q    So  you  were  asked  by  LPD  to  create  and  implement 
media  plans  for  these  people? 

A    That's  correct. 

Q    And  did  that  include  appearances  on  television,  and 
press  conferences,  interviews  with  newspapers? 

A    That's  correct. 

Q    Did  it  include  appointments  with  Government 
officials? 

A    Some  of  their  schedules  included  Government 
officials,  but  those  appointments  were  not  generally  set  by 
us.   In  fact,  they  were  rarely  set  by  us. 

Q    Who  set  them? 

A    Somebody  in  S/LPD.   There  was  normally  an  official 
in  S/LPD  who  had  responsibility  for  these  people.   We  also 

ion  to  make 
some  contacts  foi 


sometimes  depended  on  the  sponso^igo 


ed  on  the  sponsojiM^cai 


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MLLin  mroKTiHa  co..  wc. 

>0r  C  SccRT.  N  E  25 

WiituniToa.  O  C      :0OOl 


UNGIASSIHED 


586 


Q    Number  3  says  writing,  editing  and  distribution 
plans  for  ^^^c  and  news  articles  for  S/LPD  officials,  and 
S/LPD-designated  newsmakers.   Who  were  the  S/LPD  officials 
that  you  refer  to  in  that? 

A     John  Blacken,  Jonathan  Miller,  Otto  Reich,  anybody 

who  would  sign  an  (UIVCB^  or  letter  to  the  editor. 

A 

Q    So  you  would  write  them,  and  edit  them,  and  they 
would  sign  them,  and  then  you  would  distribute  them  to 
newspapers? 

A    No,  we  would  write  them,  and  edit  them,  and  then 
give  them  a  distribution  plan,  and  they  would  distribute 
them. 

Q    What  are  S/LPD-designated  newsmakers? 

A    There  were  a  lot  of  people  within  the  State 
Department,  and  Defense  Department  who  were  participants  in 

5, 

the  S/LPD  ne«naking  process. 

Q    Do  you  remember  who  some  of  those  people  were? 

A    Not  off  the  top  of  my  head. 

Q     Number  10  says  "Served  as  liaison  with  groups 
active  in  promoting  democracy  through  programs  in  Central 
America  and  the  United  States . "  Which  groups  were  you  the 
liaison  with  promoting  democracy  in  the  United  States? 

A    Well,  I  guess  you  can  read  that  sentence  that  way, 
but  we  were  not  engaged  in  the  business  of  promoting  democracy 
in  the  United  Statas^  We  were  engaged  in  the  business  of 


tas^  We  were  engaged  in 


593 


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iClASSiHED 


587 


_   1  il  promoting  Central  American  democracy,  and  we  did  that 
2  I  sometimes  in  the  United  States. 


3 

4  I 

i 
I 

5  i 

1 

6  ! 

7 ; 

i 

8  I 

9 ; 

i 

10  I 

11  i 

I 

12  ! 

13 

14 

15 

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Q     Do  you  remember  some  of  the  groups  that  you  served 
as  liaison  with? 

A    Yes,  PRODEMCA,  Gulf  and  Caribbean  Foundation, 
Freedom  House,'  I  am  tired,  and  those  are  the  only  ones  I  can 
remember  off  the  top  of  my  head. 

Q    So  those  were — 

A    .Institute  for  Religion  and  Democracy,  Catholic 
Church,  The  Evangelical  Association. 

Q    So  your  interaction  with  those  groups,  from 
September  of  1984  to  January  of  1985,  was  part  of  your 
responsibilities,  under  your  State  Department  contract,  is 
that  correct? 

A  We  were  sometimes  asked  by  officials  of  S/LPD  to 
represent  them  in  n^eetings,  or  such  organizations.  But  it 
didn't  account  for  all  of  our  contact  with  those  organiza- 
tions. 

Q    In  the  summary,  at  the  bottom  of  the  page,  it  said 
that  "The  above  activities  were  carried  at  the  direction  of 
S/LPD."   So  is  it  safe  to  assume  that  all  of  the  things  that 
are  listed  there  were  done  at  t,heir-dijecij^n? 

A    Yes. 


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Q  You  indicated  a  minute  ago,  when  I  asked  you  who 

performed  these  things,  you  listed  a  number  of  people,  and 


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you  also  said  .several  subcontractors. 

A    Yes,  I  misspoke.   He  didn't  use  subcontractors 
until  our  1986  contract,  although  we  may  have  used  them  after 
this  contract. 

Q    After  that  date? 

A    Well,  after  December,  there  may  have  been  some 
subcontractor  use. 

Q    Was  there  another  report  submitted  to  the  State 
Department  on  your  activities,  other  than  this  piece  of  paper? 

A    Oh,  sure.   There  were  several  reports.   In  fact — 

Q    I  am  talking  about  for  this  period  of  time,  from 
September  of  1984  until  January  of  1985. 

A    I  will  say  that  there  were  many  reports  submitted. 
Off  the  top  of  my  head  I  can't  tell  you  whether  any  fell  in 
that  three> month  period  or  not.   And  I  believe  the  staff  has 
been  provided  with  an  entire  notebook  full  of  those  reports. 

Q    When  did  you  begin  work  on  your  fiscal  year  1986 
contract  that  was  designated  as  secret? 

A    The  first  day  of  fiscal  year  1986. 

Q    How  could  you  perform  the  secret  contract,  if  you 
didn't  have  a  security  clearance? 

A    I  don't  think  it  had  been  stamped  secret  at  that 
point  in  time. 

Q    Well,  how  did  you  know  what  you  were  supposed  to  be 


doing,  if  you  didn't  have  the  contract?  g  gij^ a  i  O  '^  ->  t  .- -• 


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A    We  were  doing  exactly  what  we  had  done  the  year 
2  1  before,  with  the  addition  of  the  distribution  activities. 


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Q    But  what  you  had  done  the  year  before  did  not 
require  a  secret  clearance? 

A     No. 

Q    So  was  it  the  distribution  system  that  required  a 
secret  clearance? 

A    No. 

Q    .Why  did  you  need  a  facility  clearance  for  your 
offices? 

A    We  didn't,  and  I  don't  think  we  ultimately  got  one. 
We  ultimately  got  a  clearance  for  the  two  principal  members 
of  the  firm,  I  think  that  is  the  way  they  finally  did  it. 

Q    Let's  look  at  the  contract. 

MR.  OLIVER:   If  you  would  look  at,  about  half-way 
through  this  packet,  at  a  letter  from  the  Defense  Investiga- 
tive Service.   The  bottom  of  it  has  a  designation,  j-2. 
MR.  PRECUP:   We  have  it. 
BY  MR.  OLIVER! 

Q    That  is  a  letter  to  the  Chief  of  the  Procedures 
Security  Division,  Department  of  State,  from  the  Defense 
Investigative  Service,  indicating  that  the  facility  was 
granting-  an  interim  "secret"  security  clearance  on  July  30th, 
1986.   It  doesn't  have  the  capability  to  safeguard  classified 
material . 


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UNCUSSIFIED 


590 


Prior  to  July  30th  of  1986  when  you  received  this 
interim  "secret"  for  the  facility,  but  without  storage 
capacity  for  classified  material,  had  you  ever  been  given  any 
notification  that  you/  or  Mr.  Gomez  had  received  individual 
security  clearances? 

A    No.   I  don't  think  so. 

Q    Were  you  ever  notified  that  you/  or  Mr.  Gomez, 
during  the  period  of  this  contract,  had  received  security 
clearances? 

A    No. 

Q    When  you  signed  this  contract  on  September  the  2nd, 
1986,  did  you  have  a  "secret"  security  clearance? 

A    No. 

Q    How  could  you  read  the  contract  if  you  didn't  have 
a  clearance? 

MR.  PRECUP:   I  think  that's  a  rhetorical  question. 
THE  WITNESS:   I'm  not  sure  I  read  the  contract — 
MR.  OLIVER:   Well,  I  mean,  it's  a  serious  question, 
and  it's  one  that's  been  raised  by  a  number  of  people,  is  how 
could  somebody  without  a  "secret"  clearance  read  a  "secret" 
document . 

BY  MR.  OLIVER: 

Q    Was  there  any  discussion^f^ that  when  you  signed 
this  contract? 

A    Yes.   I  was  given  it  by  the  contracts  officer  to 


there  any  discussion  of  t 

UNCLASSIFIED 


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sign  and  then  she  took  back  the  contract. 

Q    But  you  did  not  have  a  copy  of  it? 

A    I  did  not  have  a  copy  of  it. 

Q    Was  it  stamped  'secret"  at  the  time  you  signed  it? 

A    I  think  so,  but  I'm  not  sure. 

Q    So  you  did  not  have  a  copy  of  the  contract  at  any 
time  during  the  period  of  your  performance  of  the  contract? 

A    That's  correct.   I  believe  that's  correct. 

Q    How  did  you  know  what  the  contract  contained?   How 
did  you  know  what  you  were  supposed  to  be  doing? 

A    Well,  we  had  been  doing  it  for  some  time,  and  we 
had  also  made  the  original  proposals  that  were  the  basis  of 
the  contract.   We  met  with  the  OCAA  auditors,   we'd  in- 
stituted their  accounting  procedures.   We  had  instituted 
their  time  and  billing  record